REGISTRATION DOCUMENT - Bourbon

CONSOLIDATED FINANCIAL STATEMENTS4Notes to the consolidated financial statementsin cash fl ows. The hedge is assessed on an ongoing basis in orderto demonstrate that it has actually been highly effective during allthe years covered by the fi nancial statements for which it has beendesignated.The hedging instruments that meet the strict criteria for hedgeaccounting are recognized as follows:Fair value hedgesFair value hedges are hedges on the Group’s exposure to changesin the fair value of a recognized asset or liability or an unrecognizedfi rm commitment, or an identifi ed portion of such fi nancial assets orliabilities, which is attributable to a specifi c risk and which can affectthe result for fair value hedges. The gain or loss on the hedged itemattributable to the hedged risk adjusts the carrying amount of theitem hedged, the hedging instrument is remeasured at fair value, andthe resulting gains and losses are recognized for the two items onthe income statement.When an unrecognized fi rm commitment is designated as a hedgeditem, the subsequent cumulative change in the fair value of thefi rm commitment attributable to the hedged risk is accounted foras an asset or a liability, and the corresponding profi t or loss isrecognized on the income statement. The changes in the fair valueof the hedging instrument are also accounted for as income/loss.The Group ceases to use hedge accounting if the hedge instrumentreaches maturity or is sold, terminated or exercised, if the hedge nolonger meets the criteria for hedge accounting, or when the Groupcancels the designation.Cash flow hedgeA cash fl ow hedge is a hedge on the exposure to changes in cashfl ow attributable to a specifi c risk associated with a recognized assetor liability or with a highly probably planned transaction, which canaffect the results. The profi t or loss corresponding to the effectivepart of the hedging instrument is recognized directly as shareholders’equity whereas the ineffective part is recognized as income/loss.The amounts recognized directly in shareholders’ equity shall berecognized in profi t or loss in the same period or periods duringwhich the hedged item affects profi t or loss (for example, for assetsthat are hedged, at the rate of the amortization made).If the hedging instrument reaching maturity is sold, terminated orexercised without being replaced or renewed, or if its designation asa hedging instrument is revoked, the amounts previously recognizedas shareholders’ equity are maintained as such until the execution ofthe planned transaction. If the transaction is no longer planned, thisamount is recognized as income/loss.1.6 TRANSLATION OF THE FINANCIAL STATEMENTS OF THE FOREIGN SUBSIDIARIESThe exchange rates used are as follows:CurrenciesAverage rate for theyear 2011Closing rate as of Dec.31, 2011Closing rate as of Dec.31, 2010AUD Australian Dollar 1.3481 1.2723 1.3136BRL Brazilian Real 2.3270 2.4159 2.2177CHF Swiss Franc 1.2326 1.2156 1.2504CNY Yuan 8.9917 8.1588 8.8220INR Indian Rupee 64.9022 68.7130 59.7580MXP Mexican Peso 17.2922 18.0512 16.5475NGN Nigerian Naira 219.0739 212.4490 203.2240NOK Norwegian Kroner 7.7935 7.7540 7.8000QAR Qatari Riyal 5.0752 4.7063 4.8282RUB Ruble 40.8841 41.7650 40.4437SGD Singapore Dollar 1.7485 1.6819 1.7136TRY Turkish Lira 2.3385 2.4432 2.0694UAH Ukrainian Hryvnia 11.2516 10.5085 10.6933USD American Dollar 1.3914 1.2939 1.3362VND Vietnamese Dong 28933.9800 27268.8000 25970.6000BOURBON - 2011 Registration Document 77