Financial performance 2024 consolidated financial statements 05 Movements in impairment are analyzed in the table below: (in € millions) 2024 2023 At January 1 (89) (94) Translation adjustments and other (1) 2 Changes in scope of consolidation (2) 5 Impairment of inventories recognized as an expense in the period (42) (21) Impairment reversals 40 19 AT DECEMBER 31 (94) (89) Impairment provisions of €15 million were reversed during the period following the write-off of the underlying receivables (2023: €14 million). 6.5 Trade payables ACCOUNTING POLICIES Trade payables are recognized initially at fair value and are subsequently measured at amortized cost using the effective interest method. Financing agreements with suppliers (reverse factoring) The Group has put in place paying agent agreements with several financial institutions. Under these agreements, the financial institution acts as a paying agent with respect to invoices due to suppliers who have entered into a bilateral agreement with the financial institution in order to be in position to factor their trade receivables from the Group. The agreements' classification in trade payables is supported by a multi-criteria analysis. In particular: n the factoring transaction is completely independent from the commercial relationship; n the supplier has full discretion to decide – on a case-by-case basis – whether to factor its receivables; n the initial payment terms are unchanged, with the date of payment to the supplier or the bank, whichever is the case, corresponding to the payment date indicated on the invoice; n the Group is not affected by the factoring cost because the discount is borne by the supplier and is paid directly to the bank. Trade payables concerned by the program are presented separately in the consolidated statement of financial position under "Trade payables covered by reverse factoring contracts". In the consolidated statement of cash flows, these transactions are included in cash flows from operating or investing activities (note 10). Trade payables are analyzed in the following tables: (in € millions) December 31, 2024 December 31, 2023 Trade payables 3,086 3,075 Trade payables under reverse factoring agreements 689 530 TRADE PAYABLES 3,775 3,605 Trade payables under reverse factoring agreements amounted to €689 million at December 31, 2024. The Group has two reverse factoring programs: n The Bib Factor program available to all suppliers in 13 countries on three continents. The reverse factoring debt under this program amounted to €379 million at December 31, 2024, of which €217 million had already been paid to suppliers by the member financial institutions. The payment ranges granted to these suppliers vary widely according to their nature and local regulations in the countries concerned. n Specific program for rubber suppliers in Indonesia. The reverse factoring debt under this program stood at €309 million at December 31, 2024, of which €264 million had already been paid to suppliers by member financial institutions. The payment ranges granted to these suppliers are equivalent to those granted to comparable suppliers that are not members of the program. 374 2024 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN
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