Read the Registration Document - Guerbet

) Notes to the annual financial statements of GuerbetFigures presented in these notes are in thousands of euros.IntroductionThe balance sheet has been prepared before distribution. In consequence the dividend payment proposedto the general meeting is not included under debt.Significant accounting policiesThe financial statements have been prepared in accordance with the general principles established by the1999 French Chart of Accounts (CRC regulation 99-03).a) Estimates and assumptionsTo prepare the financial statements, the Group makes estimates and assumptions that affect the carryingvalue of assets and liabilities, income and expenses, as well as information provided in certain notes.Management reviews these estimates and assumptions on an ongoing basis in reference to pastexperience as well as other factors considered reasonable that provide the basis for these assumptions.Actual results may materially differ from these estimates in light of different assumptions or conditions.The principal material estimates made by management concern notably changes in value of investments.b) Intangible assetsPatents and marketing authorisationsPatents are carried at purchase cost. Costs associated with patents and marketing authorisations areexpensed. Patents and marketing authorisations are amortised over their useful lives.TrademarksTrademarks acquired are carried at their purchase cost. In compliance with Regulations 2002-10 and 2004-06 concerning assets adopted by the Accounting Regulatory Committee, costs for registering or renewingtrademarks are expensed in the period incurred. Trademarks are not amortised.Research and development expendituresResearch costs are expensed in the period incurred.Development expenditures are capitalised as intangible assets only if they meet the following criteria:- There exists an intent and financial and technical resources to complete the development;- It is probable that future economic benefits attributable to the asset will flow to the company;- The cost of this asset can be measured reliably.Because not all these criteria have been met, development expenditures are expensed in the periodincurred.Other intangible assetsOther intangible assets concern primarily software that is amortised over three years. Because of the optionauthorised by tax regulations to amortise software over 12 months, special excess tax amortisation hasbeen recorded. This corresponds to the additional amortisation expense in excess of amortisation forimpairment.118