NEOPOST - 2018 Registration document

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Financial statements

Statutory auditors’ report on the financial statements

Financial Assets in subsidiaries

Risk identified

Our response

Financial assets in subsidiaries amount to M€ 1.286 net at January 31, 2019. As described in the note 4 to the annual financial statements (“Financial assets”), financial assets are valued at their acquisition cost or at their contribution value. An impairment test is carried out at least once a year through the projection of future cash flows. These cash flows are based on revenue and operating income growth assumptions over five years. The result of this test relies on the judgments and estimates of management, on which these assumptions are based. Changes to assumptions could lead to material changes in the estimated recoverable amount, impacting both potential impairment charges and also potential reversals of impairment taken in prior years. Due to the uncertainty of forecasting and discounting future cash flows, the level of management’s judgement involved and the significance of the entity’s investment in subsidiaries, this audit area is considered to be a key audit matter.

We have assessed compliance of the methodology used by the Company for test indicators and the estimate of the recoverable value of each investment with accounting standards. We have analyzed forecasts of future cash flows prepared by management and compared the assumptions with available data on the market. We have also compared the carrying amounts of the Company's investments in subsidiaries with the most significant net asset value of the subsidiaries. In addition, we have compared the book values of investments in subsidiaries with the share of equity of all subsidiaries restated of dividends paid over the last 3 years.

Verification of the Management Report and of the Other Documents Provided to the Shareholders We have also performed, in accordance with professional standards applicable in France, the specific verifications required by French law. Information provided in the Management Report and in the Other Documents Provided to the Shareholders with respect to the financial position and the financial statements We have no matters to report as to the fair presentation and the consistency with the financial statements of the information given in the management report of the Board of Directors and in the other documents provided to the Shareholders with respect to the financial position and the financial statements. Report on Corporate Governance We attest that the Board of Directors’ Report on Corporate Governance sets out the information required by Articles L. 225-37-3 and L. 225-37-4 of the French Commercial Code ( Code de commerce ). Concerning the information given in accordance with the requirements of Article L. 225-37-3 of the French Commercial Code (Code de commerce) relating to remunerations and benefits received by the directors and any other commitments made in their favor, we have verified its consistency with the financial statements, or with the underlying information used to prepare these financial statements and, where applicable, with the information obtained by your Company from controlling and controlled companies. Based on these procedures, we attest the accuracy and fair presentation of this information. Other information In accordance with French law, we have verified that the required information concerning the identity of the shareholders and holders of the voting rights has been properly disclosed in the management report.

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REGISTRATION DOCUMENT 2018 / NEOPOST