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FINANCIAL STATEMENTS
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CONSOLIDATED FINANCIAL STATEMENTS
The Group’s long record of dividend payments on ordinary shares –
which automatically triggers the payment of coupons on the instruments
– does not call into question the absence of a contractual obligation
within the meaning of IAS 32.
Lastly, the “step-up” clause under which the amount of the coupons is
increased significantly after a certain date if the instruments have not
been bought back by the issuer beforehand, and the clause related to
late payment interest on the coupons (which is capitalised and accrues
at the same interest rate as applicable to the bonds), correspond to
economic constraints and not contractual obligations pursuant to IAS 32
and its current interpretations.
In view of the characteristics of the instruments and the facts detailed
above, Assystem has no contractual obligation to make payments in
respect of these perpetual debt instruments.
The various options described above do not prevent the Odirnane
bonds from being classified as equity instruments.
Other non-current liabilities
Put options over non-controlling interests (contingent liabilities relating
to share acquisitions)
The Group may write put options over non-controlling interests in certain
of its subsidiaries. The exercise price may be fixed or based on a pre-
determined formula.
The Group records a financial liability for the put options over the non-
controlling interests in the entities concerned. This liability is initially
recognised at the present value of the exercise price and at the end
of subsequent reporting periods it is measured by reference to the fair
value of the shares that would potentially have to be purchased if the
exercise price is based on fair value. Subsequent changes in the fair
value of the put are recognised in financial income or expenses.
Derivative instruments
The Group uses derivative instruments to manage and reduce its
exposure to changes in interest rates and foreign exchange rates.
Derivatives are initially recognised at fair value on the date the derivative
contract is entered into and are subsequently remeasured at fair value at
each reporting date. The method of recognising the resulting fair value
gains or losses depends on whether the derivative is designated as a
hedging instrument, and if so, the nature of the hedged item.
On inception of a hedge, the Group documents the relationship between
the hedged item and the hedging instrument. The Group also documents
its estimates both on inception and prospectively to determine the
effectiveness of the hedge in offsetting changes in fair value or cash
flows attributable to the hedged risk.
FAIR VALUE HEDGES
Fair value hedges are used to hedge the Group’s exposure to changes
in fair value of a recognised asset or liability (or an identified portion
of such an asset or liability) or a firm commitment to purchase or sell
an asset at a pre-defined price, that is attributable to a particular risk
and could affect profit. Changes in fair value are recognised in the
income statement.
CASH FLOW HEDGES
A cash flow hedge is a hedge of the exposure to variability in cash
flows that is attributable to a particular risk associated with a recognised
asset or liability or a highly probable forecast transaction and could
affect profit.
The Group applies cash flow hedge accounting when the following
conditions are met:
●
there is formal designation and documentation of the hedging
relationship;
●
the hedge is highly effective; and
●
the forecast transaction that is the subject of the hedge is highly
probable and presents an exposure to variations in cash flows that
could ultimately affect profit.
The portion of the gain or loss on the hedging instrument that is determined
to be an effective hedge is recognised in other comprehensive income
and the ineffective portion is recognised in the income statement. If the
hedging instrument expires, or is sold, cancelled or exercised, the gain
or loss initially recognised in other comprehensive income continues to
be recorded separately in other comprehensive income until the forecast
transaction occurs. If the commitment no longer exists or the forecast
transaction is no longer expected to occur, any related cumulative gain
or loss on the hedging instrument that had been recognised directly in
other comprehensive income is reclassified to profit.
Provisions
In accordance with IAS 37, a provision is recorded when the Group
has a present obligation (legal or constructive) as a result of a past
event, it is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation and the obligation can
be measured reliably.
Where the effect of the time value of money is material, provisions
are discounted using a discount rate that reflects the current market
assessments of the time value of money and the risks specific to the
liability. Where discounting is used, the increase in the provision due
to the passage of time is recognised as a financial expense.
Employee benefit obligations
The Group accounts for defined benefit and defined contribution post-
employment benefit plans in accordance with the laws and practices
of each country in which it operates.
ASSYSTEM
FINANCIAL REPORT
2015
85