2007 Reference document (PDF) - Valeo

3 Consolidated
PAGE 86
fi nancial statements at December 31, 2007
Notes to consolidated financial statements
Notes to consolidated financial statements
1. Accounting policies
The consolidated financial statements of the Valeo Group for the
year ended December 31, 2007 include the accounts of Valeo, its
subsidiaries and the Group’s share of associates and jointly controlled
entities.
Valeo is an independent Group fully focused on the design, production
and sale of components, systems and modules for the automobile
sector. It is one of the world’s leading automotive suppliers.
Valeo is a French legal entity, listed on the Paris Stock Exchange, whose
head office is located at 43, rue Bayen, 75017 Paris.
Valeo’s consolidated accounts were authorized for issue by the Board
of Directors on February 12, 2008.
They will be submitted for approval to the next Annual General
Meeting of shareholders.
1.1. Accounting standards applied
Under European regulation (EC) 1606/2002 of July 19, 2002,
the consolidated financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRS) as
adopted by the European Union.
Out of the new standards, amendments and interpretations effective
for reporting periods beginning on or after January 1, 2007, only
IFRS 7 “Financial Instruments: Disclosures” has a material impact
on the 2007 financial statements. IFRS 7 introduces more detailed
disclosure requirements for risks and financial instruments, which are
presented mainly in note 5.
The Group elected for early application, respectively as of
January 1, 2004 and 2005, of the following two amendments to IFRS
that came into force on January 1, 2006:
■ the amendment to IAS 19, introducing the option to recognize
actuarial gains and losses on defined benefit pension plans in
reserves;
■ the amendment to IAS 39, relating to hedge accounting for forecast
inter-company transactions.
The new standard which is not yet effective, has not been adopted
early, and that may have an impact on the Group’s financial statements
is IFRS 8 “Operating Segments”, which is obligatorily applicable as
from 2009. The potential impacts of this standard on the Group’s
accounts are currently being analyzed.
2007 Reference document - VALEO
Other interpretations and amendments that have been published
but are not yet applicable should not have a material impact on the
Group’s consolidated financial statements.
1.2. Basis of preparation
The financial statements are presented in euros and are rounded to
the closest million.
They have been prepared in accordance with the principal assumptions
of IFRS:
■ true and fair view;
■ going concern;
■ accrual basis of accounting;
■ consistency of preparation;
■ materiality and aggregation.
Preparation of the financial statements requires Valeo to make
estimates and assumptions which could have an impact on the
reported amounts of assets, liabilities, income and expenses.
These estimates and assumptions concern both risks specific to the
automotive supply business such as those relating to quality and
safety, as well as more general risks to which the Group is exposed
on account of its industrial operations across the globe. Whenever
the Group must exercise its own judgement regarding these risks, it
does so based on past experience and other factors considered to be
reasonable in the circumstances. These estimates and assumptions
are reviewed on a continuous basis. The definitive amounts that will
be stated in Valeo’s future financial statements may be different from
the amounts currently estimated.
The main risks to which the Group is exposed, along with the related
estimates and assumptions, are described in the following sections
of the notes to the consolidated financial statements:
■
■
■
3.4.3 Impairment losses on non-current assets ;
4.9 Provisions for other liabilities ;
5.3 Risk management policy.
1.3. Consolidation methods
< Contents >
The consolidated financial statements include the accounts of Valeo
and companies under its direct and indirect control.
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3
4
5
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