FINANCIAL REPORT - Française des Jeux

3.9. TRADE RECEIVABLES
Trade receivables are measured at their nominal value, which
corresponds to their fair value. They are impaired if the debtor’s
situation indicates that the amount may not be recoverable.
3.10. CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of demand deposits and shortterm
money-market investments that are fully liquid, have a
maturity equal to or less than 3 months on the date of acquisition,
and present an insignifi cant risk of change in value as required by
IAS 7 criteria.
Bank overdrafts are not included in cash and cash equivalents; they
are recognised as non-current fi nancial liabilities.
3.11. EMPLOYEE BENEFITS
A provision is recognised for pension obligations, which are
administered under a defi ned benefi t plan.
To determine the present value of the obligations, the Group uses
the Projected Unit Credit Method, a retrospective method with
projection of fi nal salary. The obligations are measured annually,
taking account of seniority, life expectancy, employee turnover
by category, benefi ts negotiated under collective bargaining
agreements, as well as economic assumptions such as infl ation
and the discount rate.
The expense recognised during the fi nancial year incorporates:
– additional benefi ts gained by employees
– the change, as the year goes by, in the discounting of benefi ts
existing at the beginning of the fi nancial year
– amortisation of the impact on previous years of any changes to
plans, or of new plans
– amortisation of actuarial gains and losses using the corridor
approach.
The Group applies the corridor method, under which cumulative
actuarial gains and losses that do not exceed 10% of the gross
obligation are amortised over the average remaining working life
of the active employees. This am ortisation is included in the
actuarial expense for the following fi scal year. The amortisation
rate is equal to the average remaining working life of the active
employees.
The other long-term benefi ts, which relate solely to la Française
des Jeux, are:
– Service recognition awards. These consist of days of leave and
are thus subject to social security charges. The annual expense is
equal to the net change in the obligation.
– Health coverage. Employees of la Française des Jeux retain their
health coverage upon retirement (or in the event of disability/
dismissal), which is in keeping with the requirements of the Evin
Law of 31 December 1989 and the interprofessional national
agreement of 11 January 2008. The system for former employees
LA FRANÇAISE DES JEUX — 35
runs at a defi cit and generates a provision.
The net obligations of the Group companies are recognised on
the balance sheet as a liability, under “Non-current provisions.”
3.12. PROVISIONS
A provision is recognised if, at the close of the fi nancial year, the
Group has an obligation to a third party arising from a past event,
the settlement of which is expected to result in an outfl ow of
resources from the entity, and the amount of which can be
estimated reliably. This obligation may be legal, regulatory,
contractual or implicit. The estimated amount of provisions
reported corresponds to an outfl ow of resources that the Group
has deemed probable. With the exception of those for employee
benefi ts, provisions are not discounted.
Risk or litigation provisions that must be settled within 12 months
of the balance sheet date and those related to the normal
operating cycle are presented as current liabilities. The other
provisions are presented as non-current liabilities.
3.13. DERIVATIVE FINANCIAL INSTRUMENTS
It is the Group’s policy to use the nancial fi markets solely for hedging
obligations associated with its business, never for speculative
purposes. The Group therefore uses derivative fi nancial instruments
to hedge its exposure to currency and interest rate risks. It does not,
however, qualify them as hedge instruments as defi ned in IAS 39.
Derivative instruments are measured at fair value when initially
recognised and remeasured at each balance sheet date until settled.
Changes in fair value are recognised in income.
Fair value is determined from valuation techniques that make use of
mathematical calculation methods based on recognised fi nancial
theories and of parameters whose value is determined from the
prices of instruments traded in the capital markets.