Reply SpA

Consolidated income statement
Consolidated statement of comprehensive income
Consolidated statement of financial position
Statement of changes in consolidated equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Annexed tables
Note 3 - Financial risk management
Credit risk
For business purposes, specific policies are adopted in order to guarantee that clients honor payments.
With regards to financial counterparty risk, the Group does not present significant risk in credit-worthiness or solvency.
Liquidity risk
The group is exposed to funding risk if there is difficulty in obtaining finance for operations at any given point in time.
The cash flows, funding requirements and liquidity of Group companies are monitored on a centralized basis through
Group Treasury. The aim of this centralized system is to optimize the efficiency and effectiveness of the management of
the Group’s capital resources (maintaining the availability of minimum reserves of liquidity that are readily convertible
to cash and credit committed).
The difficulties both in the markets in which the Group operates and in the financial markets need special attention to
the management of liquidity risk, and in that sense particular emphasis is being placed on measures taken to generate
financial resources through operations and on maintaining an adequate level of available liquidity as an important factor
in facing up to 2011, which promises to be a difficult year. The Group therefore plans to meet its requirements to settle
financial liabilities as they fall due and to cover expected capital expenditures by using cash flows from operations and
available liquidity, renewing or refinancing bank loans.
Currency risk and interest rate risk
As the Group operates mainly in a “Euros area” the exposure to currency risks is limited.
The exposure to interest rate risk arises from the need to fund industrial and financial operating activities and the necessity
to deploy surplus funds. Changes in market interest rates may have the effect of either increasing or decreasing
the Group’s net profit/(loss), thereby indirectly affecting the costs and returns of financing and investing transactions.
Information related to the fair value of the derivative financial instrument is disclosed in Note 27.
Note 4 - Consolidation
Companies included in consolidation are consolidated on a line-by-line basis.
Change in consolidation compared to December 31, 2009 is as follows:
Tender Reply S.r.l. constituted in the month of December 2009, in which Reply holds 80% of the share capital. The
company operates in the transport sector;
Bridge Reply S.r.l. constituted in the month of February 2010 in which Reply holds 60% of the share capital. The company
provides services related to the elaboration and administration of personnel data;
Riverland Solutions GmbH a German company specialized in consultancy and system integration on Oracle Applications,
in which Reply acquired 75.016% of the share capital in the month of August 2010;
Lem Reply S.r.l. was acquired at the end of October 2010 and Reply holds 100% of the share capital.
Change in consolidation in 2010 affects the Group’s revenues and Net profit by 1.6% and 1.5% respectively.
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