financial report and registration document 2011 - Groupe SEB

C) RESTRUCTURING PROVISIONS
The Group is considered as having a constructive obligation when
management has a detailed formal plan for the restructuring, has raised a
valid expectation in those affected that it will carry out the restructuring by
announcing its main features and no infl ow of economic benefi ts is expected
that would offset the costs of the plan.
The amount of the related provision corresponds to forecast cash outfl ows
under the plan.
1.4.12. Off -balance sheet commitments
For several years now, the Group’s reporting system has included detailed
reporting of off-balance sheet commitments. The process provides for the
reporting by consolidated subsidiaries, in their consolidation packages, of
information about the following commitments that they have given:
� guarantees, endorsements and bonds;
� security interests (mortgages and pledges);
� commitments under operating leases and fi rm orders for fi xed assets;
� other commitments.
1.4.13. Transactions between owners
Acquisitions or disposals of non-controlling interests that do not affect the
Group’s control of a subsidiary are treated as transactions between owners
and accounted for in equity. The carrying amounts of the subsidiary’s assets
(including goodwill recognised upon obtaining control) and liabilities remain
unchanged.
In the event of a partial disposal leading to the loss of control of a subsidiary,
the Group (a) derecognises the assets (including any goodwill) and liabilities
of the subsidiary at their carrying amounts at the date when control is lost;
(b) derecognises the carrying amount of any non-controlling interests in
the former subsidiary at the date when control is lost; (c) recognises the
fair value of the consideration received; (d) recognises any investment
retained in the former subsidiary at its fair value at the date when control
is lost; (e) reclassifi es to profi t or loss any gain or loss recognised in other
comprehensive income and (f) recognises any resulting difference as a gain
or loss in profi t or loss attributable to the parent. The remeasurement at fair
value of any investment retained therefore affects profi t or loss.
Note 1.5. INCOME STATEMENT PRESENTATION
1.5.1. Revenue
Revenue corresponds to the value, excluding tax, of goods and services
sold by consolidated companies in the course of their ordinary activities,
after eliminating intra-group sales.
Revenue is recognised when the signifi cant risks and rewards of ownership
are transferred to the buyer – generally when the customer receives a product
– for an amount corresponding to the fair value of the consideration received
or receivable, as determined after deducting rebates and discounts.
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Consolidated fi nancial statements
Notes to the consolidated fi nancial statements
Advertising expense contributions billed by customers and the cost of
consumer promotions that do not fulfi l the criteria for recognition as operating
expenses are recognised as a deduction from revenue. The reported amount
of revenue also includes miscellaneous revenues.
Freight and other costs billed to customers are treated as an integral part
of revenue.
Accruals are booked for deferred rebates granted to customers on the basis
of contractual or constructive commitments identifi ed at the period-end.
1.5.2. Operating result from activity
(formerly “Operating margin”)
and operating expenses
The Group’s main performance indicator is operating result from activity,
which corresponds to revenue less operating expenses. Operating
expenses comprise the cost of sales, research and development costs,
advertising costs and distribution and administrative expenses. Statutory and
discretionary employee profi t-sharing and non-recurring operating income
and expenses, as defi ned in Note 1.5.4, are excluded from the calculation.
1.5.3. Recurring operating profi t
Recurring operating profi t corresponds to operating result from activity less
statutory and discretionary employee profi t sharing.
1.5.4. Operating profi t
Operating profi t comprises all the recurring and non-recurring income and
expenses generated in the course of the Group’s ordinary activities, including
income and expenses resulting from one-off decisions or transactions that
are unusual in terms of their amount. Non-recurring operating income and
expenses mainly include the following items (see Note 6 for details):
� costs of signifi cant restructuring plans;
� impairment losses on property, plant and equipment and intangible assets,
including goodwill;
� costs related to business combinations (excluding the costs of issuing
equity instruments or of new debt contracted for the purpose of the
business combination) and the remeasurement at fair value of any
previously held investment on the date control was obtained;
� gains or losses recognised upon losing control of a subsidiary, including
the remeasurement at fair value of any investment retained;
� gains and losses on very exceptional events (litigation, asset disposals, etc.
involving unusually large amounts) and changes in provisions booked for
these types of events.
1.5.5. Other income statement items
Accrued interest on interest-bearing instruments is recognised by the
effective interest method based on the purchase price.
Dividend income is recognised when the shareholders’ right to receive
payment is established.
Finance costs are recognised in the income statement on an accruals basis.
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