REGISTRATION DOCUMENT - Bourbon

4NotesCONSOLIDATED FINANCIAL STATEMENTSto the consolidated financial statementsIt should be noted that the following standards or interpretationswere not adopted by the European Union as of December 31, 2011:3 Amendments to (1) IAS 1 “Presentation of items of othercomprehensive income”;3 Amendments to (1) IAS 19 “Employee benefi ts”;3 IFRIC 201“Stripping costs in the production phase of a surfacemine”;3 Amendments to IFRS 1 “Severe hyperinfl ation and removal offi xed dates for fi rst-time adoption of IFRS”;3 IFRS 9 “Financial instruments”;3 Amendments to IAS 12 “Recovery of underlying assets”;3 IFRS 10 “Consolidated fi nancial statements ”;3 IFRS 11 “Joint arrangements”;3 IFRS 12 “Disclosure of interests in other entities”;3 IFRS 13 “Fair value measurement”;3 IAS 27 revised “Separate fi nancial statements”;3 IAS 28 revised “Investments in associates and joint ventures”.1.4 USE OF ESTIMATES AND ASSUMPTIONSPreparation of the fi nancial statements in accordance with theconceptual framework of the IFRS involves the use of estimates,assumptions and assessments that affect the amounts presentedin those fi nancial statements. These estimates are based on pastexperience and on other factors considered to be reasonable giventhe circumstances. As the assumptions and assessments usedand the circumstances existing on the date the statements areestablished may prove to be different in reality, the future resultsachieved may differ from the estimates used.The principal assumptions concerning future events, and othersources of uncertainty related to the use of estimates on the closingdate, changes in which during a year could generate a risk of achange in the net book value of assets and liabilities, are presentedbelow.Retirement benefit obligationsThe cost of defi ned benefi t plans and other post-employmentmedical coverage benefi ts is determined on the basis of actuarialvaluations. Those valuations are based on assump tions aboutdiscount rates, salary increase rates, mortality rates, and theprobability of employment in the Group at the time of retirement. Themethod for calculating discount rates has remained unchanged fromprevious years. The rates are calculated based on global indicessuch as Reuters.Because of the long-term nature of such plans, the uncertainty ofthose estimates is signifi cant. The net liabilities (long-term share)funded for these benefi ts granted to employees as of December 31,2011 was €7.7 million (€6.8 million in 2010). More details areprovided in note 3.14.Financial instruments measured at fair valueFor most of the instruments traded over the counter, the valu ation ismade using models that use observable market data. For example,the fair value of interest rate swaps is generally determined usingrate curves based on the market interest rates observed on theclosing date. The fair value of buying forward exchange contractsis calculated by reference to the current forward exchange rates forcontracts with similar maturities. The discounting future cash fl owsmethod is used to value other fi nancial instruments.Impairment test on goodwillAt least once a year, the Group assesses whether it is necessaryto depreciate goodwill by using impairment tests (see note 1.5.2).Those tests require an estimate of the recoverable value of the CashGenerating Units to which the goodwill is allocated. Recoverablevalue is defi ned as the higher of the useful value and the fair value(net of disposal costs). In order to determine the useful value, theGroup has to estimate the future cash fl ows expected from eachCash Generating Unit and an appropriate discount rate in order tocalculate the present value of these cash fl ows.The expected future cash fl ows used to calculate the useful value ofeach CGU are calculated based on the Group’s fi ve-year businessplans.The fl ows are discounted at a rate measured on the basis of theaverage weighted cost of the capital determined for the Group.Analyses are then done to determine the sensitivity of the valuesobtained to a variation in one or more of the assumptions in thebusiness plan.Since by its nature the discounted cash fl ow method used to measurethe useful value of the CGUs to which the goodwill is allocated isuncertain, the actual future cash fl ows can vary from the future cashfl ow projections used to determine the useful value.The tests done in 2011 (estimate of the recoverable value of the CGU– in this case their fair value) did not show any impairment requiringa depreciation of goodwill.Impairment tests on assetsIntangible assets with defi nite useful life and property, plant andequipment are tested for possible impairment as soon as there isany indication that the assets may be impaired (see notes 1.5.5 and1.5.6), i.e. when events or specifi c circumstances indicate a risk of(1) Since the amendments to this standard do not confl ict with the existing texts, they can be applied as of December 31, prior to their adoption by the EU. TheGroup has, however, decided not to apply them early.70BOURBON - 2011 Registration Document