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FINANCIAL STATEMENTS
6
CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1
REPORTING ENTITY AND BASIS OF PREPARATION
Reporting entity
The Assystem Group (hereinafter also referred to as the “Group”) is an
international leader in the field of engineering.
The Group’s parent company is Assystem (hereinafter also referred to as
the “Company”) – a French public limited company
(société anonyme)
governed by a Board of Directors, whose registered office is located
at 70, boulevard de Courcelles, 75017 Paris, France.
The consolidated financial statements for the year ended 31 December
2016, as well as the accompanying notes, were approved by
Assystem’s Board of Directors on 7 March 2017. However, these
financial statements will only be considered definitive after approval by
the Company’s shareholders at the Annual General Meeting scheduled
to be held on 16 May 2017.
The consolidated financial statements reflect the accounting position of
Assystem and its subsidiaries. They are presented in millions of euros,
rounded to the nearest hundred thousand.
Basis of preparation
In compliance with Regulation 1606/2002/EC of the European
Parliament and Council dated 19 July 2002, the consolidated financial
statements of the Assystem Group for the year ended 31 December
2016 have been prepared in accordance with International Financial
Reporting Standards (IFRSs) and related interpretations as adopted by
the European Union at that date. These financial statements present
two years of data.
IFRSs as adopted by the European Union differ in certain respects from
IFRSs as issued by the IASB. The Group nevertheless ensured that the
financial information for the reported periods would not have been
substantially different had it applied IFRSs as issued by the IASB.
NEW STANDARDS, AMENDMENTS TO EXISTING STANDARDS AND
INTERPRETATIONS APPLICABLE FROM 1 JANUARY 2016
The following amendments to existing standards were applicable by
the Group as from 1 January 2016 but did not have any impact on its
consolidated financial statements:
●
amendments to IAS 1 – Disclosure Initiative;
●
amendments to IFRS 11 – Accounting for Acquisitions of Interests in
Joint Operations;
●
annual Improvements to IFRSs (2012-2014 cycle).
NEW STANDARDS AND INTERPRETATIONS ISSUED BY THE IASB BUT NOT YET
APPLICABLE AT 31 DECEMBER 2016
The Group has elected not to early adopt any standards or interpretations
that are effective for periods beginning subsequent to 31 December
2016 (notably IFRS 15, “Revenue from Contracts with Customers”,
IFRS 9, “Financial Instruments”, and IFRS 16, “Leases”). The impacts of
these new standards and interpretations are currently being analysed.
Based on the information currently available to the Group, it does not
expect its first-time adoption of IFRS 15 and IFRS 9 to have a significant
impact on its financial statements The Group has not yet completed
its analysis of the effects of IFRS 16 and therefore is not currently in a
position to estimate the impact of this new standard on the presentation
of its consolidated financial statements.
YEAR-ON-YEAR COMPARISONS
The presentation of the financial statements has not been changed
between 31 December 2015 and 2016.
MAIN SOURCES OF ESTIMATION UNCERTAINTY
The preparation of financial statements in accordance with IFRS requires
the use of estimates and assumptions that can affect the reported amounts
of certain assets and liabilities and income and expenses. The impact
of any changes in estimates is accounted for on a prospective basis.
The estimates are made by Management based on the going concern
principle using information available at the reporting date. They may
change, however, due to circumstances or new information that could
require a reconsideration of the context in which they were prepared.
Actual results may therefore differ from the estimates.
The random nature of certain estimates may make it difficult to ascertain
the Group’s economic outlook, particularly in relation to asset impairment
tests (see Note 3.3 – Goodwill).
The accounting items that are the most exposed to the risk of estimation
uncertainty are described below.
Revenue recognition
As described in Note 5.1 – Working capital requirement, revenue is
recognised at the fair value of the consideration received or receivable
for the services rendered by the Group.
Revenue generated from long-term service contracts is accounted for
in accordance with IAS 11. The stage of completion of projects and
the amount of revenue recognised are determined using numerous
estimates based on cost-monitoring and past experience. Estimates
and assumptions may be adjusted throughout the term of the contract
and could have a significant impact on future profit.
Provisions for losses on completion of contracts and project warranty
costs
Provisions for expected losses on engineering contracts may be
recognised in accordance with the percentage of completion method,
in accordance with IAS 18 and IAS 11 (see Note 5.1 – Working capital
requirement). When it becomes probable that total contract costs will
exceed total contract revenue a provision is immediately recognised
for the related loss, after deducting any previously recognised losses.
However, the loss actually recognised on completion of the contract
may differ from the amounts originally provisioned, and may have an
impact on future profit.
Figures relating to provisions are presented in Note 9.1 – Provisions.
Impairment of trade receivables
An impairment loss is recognised on trade receivables if the present
value of future amounts to be collected is less than their nominal value.
The amount of the impairment loss recognised takes into account the age
of the receivable and the debtor’s capacity to honour its obligations. A
lower recoverability rate than estimated or a default by a major client
could adversely affect future profit.
Figures relating to impairment of trade receivables are presented in
Note 5.1 – Working capital requirement.
ASSYSTEM
REGISTRATION DOCUMENT
2016
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