AFD - 2018 Registration document

6 CONSOLIDATED FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH IFRS ACCOUNTING PRINCIPLES ADOPTED BY THE EUROPEAN UNION Notes to the consolidated financial statements

Expatriate employees healthcare expenses Retirement

Retiree health insurance

Retirement lump sum

Service award

Total defined benefit plans

Grand total

In thousands of euros

Cost of services rendered over the period

0

203

3,862

1,266

5,332 9,036 2,279

142 5,474 0 9,036 24 2,303 -165 -165

Cost of past services

9,036

0

0

0

Financial cost for the period

0 0

223

1,730

326

Recognised actuarial gains (losses) Expected return on retirement plan assets Cost of services rendered Impact of reductions/liquidations Expenses booked

0

0

0

0

0

-248

-248

-248

9,036

179

5,592

1,592

16,399

1 16,400

Reconciliation of opening and closing net liability Liability at 1 January

0 -5,622

80,733 15,490

90,601 16,399

964 91,565

Expenses booked Contributions paid

9,036

179

5,592

1,592

1 16,400

0 0 0

0

0

0

0

Restatements and transfers Employer contributions

667

2,180

682

3,529 -2,952 -2,020

218 3,747 -80 -3,032

0

-1,838 -1,113

Items not to be recycled in profit or loss

0 -4,434

1,967

446

0 -2,020

Net liabilities at 31/12/2018

9,036 -9,211 9,036 -3,588

88,634 17,098

105,557 1,102 106,660

Change in net liabilities

7,901

1,608

14,956

139 15,095

6.2.6 Risk Information The role of the Executive Risk Department (DXR) is to analyse, inform and advise executive officers (General Management) on the risks to which the Group companies are exposed. It is involved in the implementation of risk policies and procedures and systems to measure, control, analyse and monitor these risks. It ensures that the Group’s activities, and the inherent risks, are in line with the risk management objectives, company policy

reporting groups and assessing the financial structure of the operations during the project appraisal cycle; P implementing the follow-up right beyond the bodies, when this right is requested by the Second Opinion unit, and reviewing the updated credit risk before agreements are signed and in the event of requests for temporary special dispensations or riders to the agreements; P half-yearly reviews of AFD’s non-sovereign credit risks and appraising the impairments; P developing tools, methods and training materials to evaluate credit risks, mainly for use by the operating departments. The Risk Monitoring Division (DSR): P monitors credit risk, mainly by ensuring the Risk Measurement Forms (RMF) are updated each half-year and keeping track of the limits; P monitors borrowers on the watchlist, impairments and provisions and application of the recovery and penalty procedures; P compiles the Group’s risk projections (portfolio, risk level, stress-tests); P conducts loss ratio studies for the purpose of analysis, collective provision allocation and determining the risk margins; P has the secretariat role for the Risk Committee (CORIS); P reports to the executive officers on discussions about the risk situation, in collaboration with the other units responsible for monitoring Group risks; P monitors the risk of the companies of AFD Group;

and regulatory requirements. This department combines:

P the Second Opinion unit, which provides a second opinion on projects which are being appraised, in accordance with Article 112 of the Order of 3 November 2014;

P the Compliance Department (DCO);

P the Operational Risk and Permanent Control Department (ROC);

P the Group Risk Management Department (DRG). 6.2.6.1 Credit risk Risk measurement and monitoring

AFD Group’s credit risk monitoring system is the responsibility of the Group Risk Management Department (DRG) within the Executive Risk Department. Operating as part of the DRG, the Credit Risk Evaluation Division (DRC) is responsible for: P validating the credit risk due diligence carried out by the DOE, rating non-sovereign counterparties, determining the

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REGISTRATION DOCUMENT 2018