www.pwelu Handbook for the preparation of annual accounts under Luxembourg accounting framework ' Forundertakings applying the Law of 19 December 2002.Table of Contents Preface Introduction General accounting p1 Annual accounts Fry ‘Management report Balance sheet Profit and loss account Notes to the annual accounts Audit of the annual accounts, 60 Filing and publication of the annual accounts 61 Consolidated accounts 63. List of the main references to the Law 65, Handbook forthe preparation of anual accounts under Luxembourg accounting famawork2 Puc Luxembourg [ Preface TheFourth'European. Accounting Directive (the “Directive”) was transposec into domestic Luxembours legislation 27,years ago! Over the years, the Directive: has been updated several times and, until now, those changes had not resulted inany statutory legislative changes for commercial companies CW oerl exert) WIRTH TU a Ta AT (0n 10 December 2010, howeter, the Luxembourg ‘government transposed the European directives ‘known as the Fair Value Directive? and the ‘Modernisation Directive? ito Luxembourg legislation. ‘Asaresult, xembourg now has anew accounting framework which offers several alternatives tots former accounting legislation, Consistent with is iberal tradition, and unlike most other European countries Luxembourg chose to {introduce some major changes in the form of options offering flexibility hat will be welcomed by undertakings. Those options include the fair value ‘option, which applies to financial instruments and some other asset categories, and the opportunity 0 prepare both annual accounts and consolidated ‘annual accounts in accordance with International Financial Reporting Standards (hereafter“IFRS”). 4 Law ay 088, 2 Droste 200 sec 5 Droste 20005160 ‘Thisis the second edition of our brochure entitled “lustrative annual accounts for commercial ‘companies in Luxembourg”, which has been renamed “Handbook forthe preparation of annual accounts under Luxembourg accounting framework”. The purpose of our brochure is tohelp preparers of ennual accounts to identify the main changes introduced by the law dated 10 December 2010 hereafter “the New Law") and to provide them with guidance onthe various options available to them. While thisbrochure | hhas been prepared to cover the most common cases, it ‘does not purport to cover all possible situations. i If your company prepares its annual accounts in accordance with IFRS, please refer to our “hustrative financial statements” publications, which are available on our website: www.pwel, These publications provide specific IFRS illstrative accounts for various lines of business ( real estate, private equity). Ifyou are interested in a comparison between Luxembourg accounting principles and IFRS, we also suggest that ‘you read our brochure called “Similarities and differences —IFRS and Luxembourg GAAP", which is available on our website as well. An updated version Including the latest changes willbe published shortly. Since this New Law enters into force atthe sametime asthe mandatory Standard Chart of Accounts (the “SCA’)* for all financial years starting on or after 1 January 2011, this wll ransaze into a busy year froma financial reporting standpoint. ‘We hope you will find this handbook helpful in the preparation of your annual accounts and stay at your disposal to provide you support whatever your needs might be. SK ae Anne SophiePreud’homme Lue Trivaudey 4 att Gran Ova! Region of 10s 2008 Pease lo eto bartrosnse The Standen Chao Anus, gure fol bath or ‘Bhembotrs anders boise uncorange’, Ea KonoI Introduction Amendments to the Accounting Law ‘The New Law of 10 December 2010 amends both the ‘Accounting Law of 19 December 2002 and section XVI of the law of 10 August 1915 on consolidated annual accounts, ‘The main legal reference in this publication isthe amended law of 19 December 2002 governing the trade and companies register and the accounting and annval accounts of undertakings, hereafter “the Lav’. This publication will mainly focus on Title ofthis Law. ‘The amendments provided by the New Law aré applicable to the 2010 financial year not closed, unless management of the company preparing the annual «> accounts decides to postpone application to the accounting period starting after the effective date of change as provided for in article 4 ofthe New Law. (One of the main changes to the Law of, 19 December 2002 isthe introduction ofthe fair value ‘option in the Luxembourg accounting framework. This change leads tothe possibility of choosing from several different accounting frameworks which can be summarised as Luxembourg Generally Accepted ‘Accounting Principles (“Lx GAAP") under the historical cost convention, or fair value convention and IFRS, The general provisions relating to these frameworks are further described on page 8. ‘According to the New Law, companies reporting wider Lux GAAP must now refer to the substance ofthe transactions or the contracts for their presentation in the profit and loss account andin the balance sheet. In other words, financial reporting requires taking into account the economic reality of the recorded operations beyond their legal aspect. The lack of guidance in the Newr Law on this topie will certainly generate complex discussions. “Tot: Commer books Law of 19 Deseo 2002, ‘To promote transparency in annual and consolidated annual accounts, companies must also now disclose the transactions made with related parties when they are significant and have not been made under normal ‘market conditions?. Asa recult ofthe introduction ofthe SCA forthe accounting periods starting in 2011, the New Law also modifies the layout of the balance sheet and the profit ‘and loss account to provide a clearer link between the classification of the trial balance and the captions of the balance sheet and profit and oss account. Despite the absence of an official reconciliation between the SCA and the annual accounts, the preparers of annual accounts should find the layout changes useful even if, not perfect. In addition tothe above, the New Law increases the size criteria forsmallsized, medium-sized and large-sized entities (ee criteria hereatet together ‘wit the size criteria elated to consolidation obligations. also enhances the quality of information provided, for example offbalance sheet commitments disclosures and more detailed content for the management report. 2 Yansstons nade betan ltd partes conte ach ‘rotor company anol fered oh. yer Handbool forthe preparation of annual accounts under Linembourg accounting frameworkPw Luxembourg Introduction (cont.) Scope In accordance with article 24 (emending the “Commercial Code") and article 25, Title IF of the Law applies tothe following undertakings: public limited ‘companies (sociétés anonymes), partnerships limited. by shares (ociétés en commandite par actions), limited liability companies (société responsabilité limitée), cooperative companies (sociétés conpératives), economic interest groupings (groupements dintérét économique), European economic interest groupings (Groupements européens dinterét économique), limited partnerships (sociétés en commandite simple), general partnerships (sciétés en nom collectif) and individual business owners whose annual tumover exceeds EUR 100,000 (exclusive of VAT). Only a few provisions of Title I apply to credit institutions, insurance and reinsurance companies and pension savings associations with variable capital (SEPCAVS) for example on the filing and publjeation of annual accounts). Specific provisions also apply to investment companies with variable capita (SICAVS) and financial holding companies*, . ‘Luxembourg branches of foreign companies are included in the definition of an “undertaking” as found in the Commercial Code and are thus also ‘concerned by the Law. Additionally, even ifthe Law does not apply to not-for-profit associations or foundations, such entities ‘could also apply the accounting policies described in the Law. 4 Tot: Comercial books Naw of 18 Doce 200) 2 Pasca tert the CNC peti -1 on he ton of Franca Fting coreanes Sects de PatpatonFrencleo, Size criteria First and foremost, this publication provides guidance forthe preparation of annual accounts (balance sheet, profit and loss account and notes to the accounts) for large-sized companies. While this example does not ‘purport to deal with al cases that may arse, we believe that t applies to most companies irespective of any ‘economic or legal eriterion, except for the size ofthe ‘company, taking into account the provisions of articles 35 (small sized companies) and 47 (medium- sized companies) ofthe Law. Therefore, a distinction should be made between large-sized, medium-sized and small-sized companies onthe basis ofthe new following characteristics (increased by the New Lav}: sizedcompanies Ho yess sito Hie erate aa sta aoftamtd isan be Medium:sized'companies (art 47 * Balenceshee (ol gO aaileoraraesl = OI Goi uetyte= ep arci=e Saetle eampeneeHee Seen ronda © Nessarietoy se soonststssonlto strata oaescbahy eanI Introduction (cont.) ‘Smal-sized companies which on their balance sheet date donot exceed the limits oftwo ofthe three criteria mentioned previously may draw up abridged balance sheets, profit and loss accounts and notes to the accounts. Medium sized companies which on their balance sheet date donot exceed the limit oftwo of the three criteria mentioned previously may draw up abridged profit and loss accounts and notes to the accounts. These derogations do not apply to ‘companies whose transferable securities are quoted ‘ona European regulated stockexchange! ‘When a company, on its balance sheet date, either exceeds or ceases to exceed the limits of two of the three criteria, this circumstance will affect the application of the derogation provided for under this article ifit occurs in two consecutive financial years r.36). ‘The actual implementation of this time limited to divergent and changing interpretations: some suggest thatits effects should be felt tthe end ofthe second financial year, while others believe that this change should only apply atthe end ofthe third financial year. ‘We recommend application atthe end ofthe second financial year during which two outof the three thresholds ae exceeded or are no longer exceeded. ‘The introduction of various new concepts in the New Lawis not systematically commented on in the preparatory documents and will certainly generate discussions and raise questions. We hope that the Accounting Standards Committee, under the authority ofthe Ministry of Justice, willhelp shed sone light on specific interpretations. 1 Astin by a4 paragraph 1) pot 14 ofthe Dress 2004/6 he etcptar aan ond ie Core thao ‘he second part of tis publication also takes a brief Jookat consolidated accounts and reviews the auditing, filing and publication of annual accounts. ‘The balance sheet and profitand loss account items that are preceded by Arabic numerals in articles 4 and 46 ‘of the Law may be combined where such combination makes for greater clarity or where the items are ‘immaterial in amount for the purpose ofthe true and fair view (art. 26 (3)). The tems thus combined are disclosed separately in the notes to the accounts. ‘Where an asset ora liability relates to more than one layout item, its relationship to other items mustbe disclosed either under the item where it appears or in the notes to the accounts if such disclosure is essential to the comprehension of the annual accounts. ‘True and fair view ‘The arinual accounts shal give atrue and fair view of the undertakings assets, liabilities, financial postion and results. Where the application ofthe provisions ofthe Law would notbe sufficient to givea true and fair view within the meaning of article 26 (3), additional information must be given. Where in exceptional cases the application of a provision ofthe Law is incompatible with the true and fair view, that provision must be derogated from. Any such derogation must be disclosed in the notes to the accounts with a statementoof ts effect on the assets, liabilities, financial position and results. ‘Where a provision ofthe Law requires a quantitative or qualitative assessment, it must be performed by the ‘management of the undertaking in accordance with the true and fair view principle. + esas lant i fon itt of charg he ey petro bch" cont raeRef, article ofLaw 2 @, 294) 28 29(5) 51 SL [ General accounting principles (cont.) ‘Substance over form ‘The presentation of the amounts recorded on the balance sheet and profit and loss account should refer to the substance ofthe operation or ofthe recorded contract. Offsetting Any setoff between asset and liability items or between income and expenditure items i prohibited. Comparative figures In respect of each balance sheet and profit and loss account item, the figure relating to the corresponding item for the preceding financial year must be shown. Where the figures from one year are not comparable to figures of the next year, and where the figures ofthe preceding year have been adjusted, this must be disclosed in the notes tothe accounts with relevant comments. ‘To ensure the comparability of the annual accounts, the layout of the balance sheet and of the profit and loss account, particularly as regards the form aclopted for their presentation, may not be changed from one financial ‘year to the next. Any such departures are permitted in exceptional cases but must be disclosed and justified in ‘the notes tothe accounts. ‘A balance sheet or profit and loss account item for which there is no amount shall not be shown except where there is corresponding amount forthe preceding financial yar. Change in accounting policies ‘Accounting policies shall not be modified from one accounting year to another. Any exceptional departure requires an explanatory note detailing the reason for such changes and should explain their impact on the financial situation and results of the undertaking’ ‘The change in accounting policies linked to the adoption of the New Law has tobe treated in the same manner. Correction of errors By virtue ofthe intangiilty ofthe opening balance, corrections of errors ire recorded inthe year when discovered, They do notlead tothe modification of comparative figures. + Farcompareen purposes management ay open ha anal scours nat othe compara gs corn wth prom! ues ‘Rare Me pronte puts data Pave bor essed ung te now sonouning les the Sa Handbook or the preparation of annual accounts under Luxembourg accounting framework 78 ofLaw 10) GAsexies Perc Luxeribourg " General accounting principles (cont.) Valuation principles Since the New Law of 10 December 2010 concerning the introduction of International Financial Reporting Standards for undertakings modifying the Law of 19 December 2002 and the Law of 10 August 1915, [Luxembourg companies can prepare their annual accounts following different accounting standards. Inaddition to the historical Luxembourg accounting standards based on article 51 (1) (prudence principle, non-compensation principle, etc), the Luxembourg Law now allows companies to prepare their annual accounts using the fair value model for financial instruments (art, 64bis) and for certain other categories of assets (art. 64sexies) or to prepare their annual accounts in conformity with IFRS (art. 72bis). ‘Unless there isan exceptional derogation which is disclosed and explained in the notes to the accounts, the valuation of items shown in the annual accounts under the historical cost model shall be made in accordance ‘with the following general principles: ‘+ ‘The company is presumed to be carrying on ts business asa going concern (going concer principle); ‘+ The valuation methods may not be modified from one financial year to another (permanence of methods principle); ‘Valuation must be made on a prudent basis (prudence principe), and in particular: = exceptin the case ofa specific exemption provided for by the Law only profits realised atthe balance sheet date may be included; ~ allvalue adjustments must be taken into account, irrespective of whether the result ofthe financial year is aloss ora profit; : ~ all foreseeable risks which have arisen in the course ofthe nancial year concerned or in a previous financial year must be taken into account, even ifsuch liabilities or losses become apparent only between the balance sheet date and the date on wich the accounts are drawn up; ~ besides those amounts, the company can take into consideration all foreseeable libiites and potential losses which have arisen in the course ofthe financial year concerned or ofa previous financial year, even ‘such liabilities or losses become apparent only between the balance sheet date and the date on which itis drawn up; + Income and charges relating tothe financial year in respect of which the accounts are drawn up mustbe taken into account irrespective of the date of receipt or payment of such income or charges (cut-off principle); * The components of asset and liability items must be valued separately (non-compensation principle) Lae GAAP: fair value model The general principles described above are applicable to the fair value model except for the prudence principle for which undertakings may derogate toa certain extent by applying fair value to their financial instruments, including derivatives and some other categories of assets Asan alternative (art. 64bis (Sbis), companies can value their financial instruments in accordance with IFRS as ‘adopted by the European Union. In this case, the disclosure should also follow IFRS requirements. We recommend that you refer to the appropriate section of the financial instruments of the PwC Ilustrative IFRS financial statements brochures prepared by sector which are available on our website: wwwpweu. 1 fer toa 6rf General accounting principles (cont.) Ref. article oflaw TERS 7bis ‘Companies referred to in article 25 have the option of preparing their annual accounts according to IFRS as adopted by the European Union and could accordingly depart from Chapter If of Title Tof the Law of 19 December 2002, Inthis case, companies are required to disclose additionally in the notes to the accounts the information stipulated in article 65 paragraph (1) points 2°9°,12%,19%,15" and 16 and remain subject to the dispositions of articles 68, 68bis, 69, 69bis, 69ter, 70 and 71. For further guidance on companies applying IFRS, we recommend that you refer to our Ilustrative IFRS ‘nancial statements brochures prepared by sector which are available on our website: www.pwe-lu. Handoook forthe proparation of annual aecounts under Luxembourg accountng framework[ Annual accounts as at ... (balance sheet date)/ for the period from... to ... (balance sheet date) Name of the company Société Anonyme/Société& Responsabilité Limitée/ Société en Commandite par Actions/Société Coopérative/ Société en Commanclte Simple/Société en Nom Collectif/ Groupement (Européen) d'Intérét Eeonomique/ Luxembourg branch' ‘Address ofthe registered office R.GS, Luxembourg: trade register number (amount ofthe share capita for limited liability companies) + Fars brane, spay ta nam ofthe company to we the branch belongs. Handbook forthe reparation of annual accounts under Luxembourg accounting framework 1Table of Contents Hianagemoat repent Balance sheet petoit aiid oak account Ei eeeeeeee eee Notes to the annual accounts 25 Handbook forthe propartion of anual accounts under Luxembourg accounting famework 13rrr reer r errr cere cere { [ Management report Ref. article ofLaw Introduction “The management of the company* has to prepare a management report which is generally included in the annual accounts asa preamble to the financial statements. ow ‘The auditor should indicate inthe audit opinion whether or not the management report isin accordance with the annuel accounts ofthe same financial year. [Branches of companies incorporated under foreign law and individual business owners are not required to draw ‘upa management report, even though their business isin accordance with the definition of an undertaking. 69) ‘Companies referred to in article 35 (small-sized companies) are not obliged to prepare a management report, provided that they include in their notes to the accounts the information concerning any acquisition of own. shares as prescribed by article 9-5, paragraph (2), However, thisright does not apply to companies whose transferable securities are quoted on a European regulated stock exchange. Contents Gy ‘The management report must inchude atleast a fair review of the development of the company’s business, is results and position which provides clarification on the data shown in the annul accounts, together with a s8@a) description of the main risks and uncertainties the company is facing. This description consists of a balanced and exhaustive description ofthe evolution of the business, results and financial situation ofthe company, linked to the volume and compléxity of the business. e@bo ‘To understand the evolution ofthe business, results and financial position ofthe company, this analysis should include key indicators of performance for both financial and non-financial aspects which impact on the activity of the company and in particular information related to environmental and personnel matters. In presenting its analysis, the management report should make cross-references with the amounts indicated in the annual accounts and with other related additional explanations. Boa Companies referred to in article 47 (medium-sized companies) are exempt from providing non-financial information, However, this right does not apply to companies whose transferable securities are quoted on a European regulated stock exchange. 682) ‘The report shall also give an indication of: ‘© Any important events that have occurred since the end of the financial year; + The company’ likely future development; + Activities in the field of research and development; + Inrespect ofthe acquisitions of own shares, the information prescribed in article 49-5, paragraph (2) of the amended Law of 10 August 1915 on commercial companies, should inelude: ~ the reasons for acquisitions made during the financial year; the number and the nominal value, or, in the absence of nominal value, the accounting par value, of the shares acquired and disposed of during the financial year and the proportion ofthe subscribed capital which they represent; 1 These ar companies incorporated unr Lert waar nat. 1 fhe amended ete TBOVEE of 25 ty 1978 Tat to sa "Pub imtas coroaric,petorsips ites by shares a tes aby compares 5, Sowa pnertpe ae red porertipe une corah conatons, 2 rfirarendod ow of Onigu i8en error coro A 2 clases rye and ait en commana 2 etna a4 ap pi 4 tm Gv 2004000 oh Exepem Paar ad ofthe Canalo 2 A204 on mae 14 PwC LuxembourgRef. article of Law f Management report (cont.) ~ incase of acquisition or disposal for value, the consideration for the shares; = thenumber and nominal value or, in the absence of nominal value, the accounting par value, of ll the shares acquired and held in the company’s portfolio as well asthe proportion ofthe subscribed capital, which they represent. ‘+ The existence of branches of the company; ‘With respect to the use offinancial instruments by the undertaking and when thisis relevant forthe valuation of ts assets, liabilities, financial situation and profit or loss: = the objectives and policy of the company in terms of financial risk management, including its policy concerning the hedging of each main category of transactions for which hedge accounting is used; ~ thecompany’s exposure to market, credit liquidity and treasury risks. Additional information for quoted companies In accordance with article 11 of the Law of 19 May 2006, the following additional information should be included in the management report of quoted companies: 4) The structure ofthe capital ofthe company, including securities which are not admitted to trading ona regulated rmarketin a Member State, where appropriate with an indication ofthe different classes of shares and, for each class of hares, the rights and obligations attaching to itand the percentage of total share capital that itrepresents; ') Anyrestrictions on the transfer of securities, stich as limitations on the holding of securities or the need to obtain the approval ofthe company or other holders of securities, without prejudice to article 46 of Directive 2001/34/EC; 6 Significant direct and indirect shareholdings (including indirect shareholdings through pyramid structures and cross-shareholdings) within the meaning of Directive 2004/109/EC; @) The holders of any securities with special control rights and a description of those rights; ©) The system of contrel of any employee share scheme where the control rights are not exercised directly by the ‘employees; 1 Any restrictions on voting rights, such as limitation ofthe voting rights of les ofa given percentage or ‘number of votes, deadlines for exercising voting rights, or systems whereby, with the company’s cooperation, the financial rights attaching to securities are separated from the holding of securities, g) Any agreements between shareholders which are known to the company and may result in restrictions on the transfer of securities and/or voting rights within the meaning of Directive 2004/109/EC; 1) The rules governing the appointment and replacement of board members and the amendment ofthe articles of association; i) The powers ofboard members, and in particular the power to issue or buy back shares; 4) Any significant agreements to which the companys party and which take effect, aker or terminate upon a change of contro of the company following a takeover bid and the effects thereof, except where their nature is such that their disclosure would be seriously prejudicial to the company; this exception shall not apply ‘where the company is specifically obliged to disclose such information on the basis of other legal requirements; 10 Any agreements between the company and its board members or employees providing for compensation if they resign orare made redundant without valid reason or if their employment ceases because ofa takeover bid, Information required under points ¢),d),), bi) andi) can alternatively be detailed in the corporate governance declaration (see next page). Areference to the location where information is disclosed should be made in the relevant report. + Law 18 May 2006 raneposng th drectie 2000/2512 of th European Pama aretha Cowl ot 21 Apa 2004 en akan bids Handbook forthe preparation of annusl accounts under Luxembourg accounting framework 15Ref. article ofLaw 6Bbis 16 Pw Luxembourg T Management report (cont.) Corporate governance declaration ‘Each company or which shares are quoted on a Buropean regulated stock exchange! must include a declaration ‘on corporate governance inthe management report. "This declaration forms a specific section in the management report and includes asa minimum the following 8) Designation of: ‘code of corporate governance the company has to follow; and/or ++ code of corporate governance the company has decided to fellow voluntarily; and/or + allrelevant information related tothe corporate governance applied which goes beyond whats legally required by national aw. ‘As regards the first two point, the company should also indicate where the relevant text can be publicly consulted. When the last item applies, the company should publicly communicate its corporate governance practices ) If in accordance with national legislation, a company departs from one ofthe models of corporate governance described above, the company must describe which partithas departed from and the reason for this departure. Ifthe company has decided to apply none ofthe provisions of one ofthe corporate governance frameworks described above, it must explain the reason why; Description of the principal characteristics of internal contro systems and risk management procedures in relation to financial reporting processes; @) Information on: ‘the significant (above 16%) quoted participations, directly or indirectly owned; ‘the shareholders with special right of control including a description of their rights; ‘any restriction on voting rights, uch as limitation of voting right for the holder of a certain percentage or foracertain number of votes, compulsory timing for the exercise of the voting right, or system where with the cooperation of he company, the financial rights attached to the shares ate separate from the possession of shares; + the applicable rules on the appointment or replacement of the board members or management team, together with the applicable rules on the modification ofthe deed of incorporation of the company; ‘the powers ofthe board members or management team and in particular regarding the power to issue and buyback shares. ©) Operating method and main authority of the general meeting of shareholders, together with a description of shareholders’ rights and how they can be exercised, unless this information is already detailed in national laws and regulations, 1) Composition and operating method of administrative, management and supervisory bodies and their respective boards. ‘The required information can alternatively be presented ina separate report published with the management | report ora reference can be mentioned in the management report indicating the company’s website where such | information is publicly availabe, + Aetna pane (po oth reve REC oth cpa Pant ante Cont of 2 pact on a | 2 Garp tat secu han shee cuted on Evopemnrepdid soccer mat oa down ork 6 i Sree 20ut 3/26 ote Europea Params and Soul 927M sibs on merle hana insurers ae erg ee ‘Iacsu of pita bs andh.eoip ees companies ave nuns taresnegutaiain ta menor ae ruler ang aly ‘crag or pstgtagh fot To the ctve SOOANEC oe Europes Paral and Counc 21 Aa 20D on mss Ih ‘inal ment: 8596 GhRef. article ofLaw ' Balance sheet Layout ‘Since the implementation of the New Law of 10 December 2010 modifying the Law of 19 December 2002, the layout ofthe balance sheet set forth in article 34 has been modified. “The undertakings referred to in article 35 (small-sized companies) may draw up their balance sheet in the form ofan abridged balance sheet shovring only those items preceded by capital letters and Roman numerals in article 34, disclosing separately the claims on debtors and amounts due to creditors which are due and payable after more than one year, in tems Dll under “Assets” and B and D under “Liabilities, respectively, but in total foreach. This exemption is, however, not permitted for companies with transferable securities which are quoted ‘ona European regulated stock exchange. ‘The Grand Ducal Regulation dated 10 June 2009 does not prescribe any mandatory mapping between the items featured inthe Standard Chart of Accounts and the balance sheet items referred to in article 34, Thisisleftto the discretion of Management. Currency of presentation of annual accounts ‘The annnal accounts are in principle drawn up in the currency in which the subscribed capital is expressed. Nevertheless, the company is permitted to draw up its gpnual accounts in a currency ofits choice, for instance, in the reporting currency ofthe group to which it belongs. 1 hacen yar. 4preran (i pol 1 ofthe Oreo 204/970 of tha European Pst nd ofthe Caurl o21 Ap 2004 on mars (rant ietument ocounts under Luxembourg accounting framework 17 Handbook forthe preparation of nmuRef f article of Law 34 18 Puc Lxembourg ' Name of the company Balance sheet as at... (balance sheet date) Denominated in (currency in which the capital is denominated - or other selected currency) Note(s) N Na ASSETS (currency) (currency) A, Subscribed capital unpaid 1. Subscribed capital not called 1, Subscribed capital called but unpaid B, Formation expenses Fixed assets L_ Intangible fixed assets 1 Research and development costs 2, Concessions, patents, licences, trademarks and similar rights and assets ifthey were: 2) acquired for valuable consideration and need not tobe shown. under C13 by created by the undertaking itself 3. Goodwill to the extent that it was acquired for valuable consideration, 4, Payments on account and intangible fied assets under development Tangible fixed assets 1. Land and buildings 2, Plantand machinery 3, Other fixtures and ftings, tools and equipment 4, Payments on accourit and tangible fixed assets under development I, Financial fixed assets 1L Sharesin affiliated undertakings 2, Amounts owed by affiliated undertakings 3. Shares in undertakings with which the company islinked by virtue of participating interests 4, Amounts owed by undertakings with which the company is linked by virtue of participating interests Securities held as fixed assets . Loans and claims held as fixed assets 7. Own shares or own corporate units ‘Tn comparing noes fom an tegral pat of thse annul acount4 a] Ref. article ofLaw ' Name of the company Balance sheet as at... (balance sheet date) ‘Denominated in (curreney in which the capital is denominated - or other selected currency) Note(s) N Na ASSETS (cont.) (currency) (currency) D. Currentassets L 1. m1, N. Inventories 1. Raw materials and consumables 2, Work and contracts in progress 3, Finished goods and merchandise 4, Payments on account Debtors 1. Trade receivables : 2) becoming due and payable within one year 1) becoming due and payable after more than one year 2, Amounts owed by affliated undertakings ) becoming due and payable within one year b) becoming due and payable after more than one year 3, Amounts owed by undertakings with which the company islinked by virtue of participating interests a) becoming due and payable within one year ') becoming due and payable after more than one year 4, Other receivables ) becoming due and payable within one year ) becoming due and payable after more than one year ‘Transferable securities 1. Shares in affiliated undertakings and in undertakings with which the company is linked by virtue of participating interests 2. Own shares or own corporate units 3. Other transferable securities Cash atbank, cash in postal cheque accounts, cheques and cash in and E, Deferred charges Total Assets ‘The accompanying ots frm nntapal pro hse aru acount Handbook forthe preparation of annual accounts under Luxembourg secoumtingfemework 19Name of the company Ref. article Balance sheet as at.... (balance sheet date) flaw Denominated in (currency in which the capital is denominated - or other selected currency) Notes) N Na 34 LIABILITIES (currency) (currency) A. Equity 1. Subscribed capital 1 Share premium and similar premiums ML, Revaluation reserves IV, Reserves 1 Legal reserve 2. Reserve for own shares or own corporate nits 3, Reserves provided for by the articles of association 4, Other reserves V. Profit loss brought forward Vi. Profitorloss forthe financial year/period VIL Interim dividends VILL. Capital investment subsidies 1X, Temporarily not taxable capital gains B, Subordinated debts . Provisions 1. Provisions for pensions and similar obligations 2. Provisions fortaxation «,, 3. Other provisions | D. Non-subordinated debts 1. Debenture loans ) Convertible loans 4, becoming due and payable within one year ii, becoming due and payable after more than one year ') Non-convertible loans i. becoming due and payable within one year ii, becoming due and payable after more than one year 2, Amounts owed to credit institutions 2) becoming due and payable within one year ) becoming due and payable after more than one year i 3, Payments received on account of orders as far as b they are not deducted distinctly from inventories 2) becoming due and payable within one year +) becoming due and payable after more than one year 4. Trade creditors ‘) becoming due and payable within one year i ») becoming due and payable after more than one year 5. Billsofexchange payable ' «) becoming due and payable within one year ') becoming due and payable after more than one year i ‘Te eazpanyng note fom a ig pa of hse annul acon 20° PwC LuxembourgRef. article ofLaw " Name of the company Balance sheet as at.... (balance sheet date) Denominated in (curreney in which the capital is denominated —or other selected currency) Note(s) N Na LIABILITIES (cont.) (currency) eurreney) 6. Amounts owed to affiliated undertakings ) becoming due and payable within one year ) becoming due and payable after more than one year 7. Amounts owed to undertakings with which the company is linked by virtue of participating interests ) becoming due and payable within one year ') becoming due and payable after more than one year 8, Taxand social security debts, a) Taxdebis ») Social security debts 9. Other creditors 2) becoming due and payable within one year ) becoming due and payable after more than one year E, Deferred income ‘Total Liabilities “he accompanying nes form anna pao hese anal aon Hendbook forthe poparation of annual accounts under Lusembourg accounting framework 212 r Profit and loss account Ref. article ofLaw Layout Since the implementation of the New Law of 10 December 2010 modifying the Law of 19 December 2002, ‘the layout ofthe profit and loss account set forth in article 46 has been modified. a ‘The undertakings referred to in article 47 (small-sized and medium-sized companies) may derogate from the layouts prescribed in article 46 by combining items A.1, A.2, B.1 to B.3 and B.5' inclusive under one item called ‘Gross profit” or “Gross loss, as the case may be. This exemption is, however, not permitted for companies with transferable securities which are quoted on a European regulated stock exchange* 1 The aria of he Lew combining ar At A2 nd 81 to Beg, pout apie, core deed, th te BA "Revrel of value acters Bue lu Law St dn conan waren se Oho ame oud te 2 Aecnedby at panooph st ow Oacre 00408 Cf he Eanpean Palani ano he Gant 2 Apa oben mts Pwo LuxembourgName of the company Ref. article Profit and loss account for the year ended ... (balance sheet date)/ ofLaw (for the period from... to ... (balance sheet date) Denominated in (currency in which the capital is denominated — or other selected currency) Note(s) N Na A, CHARGES (Gurreney) (currency) 1. Use of merchandise, raw materials and consumable materials 2. Other external charges 3. Staffeosts a) Salaries and wages 1) Social security on salaries and wages ©) Supplementary pension costs <) Miscellaneous social costs 4, Value adjustments 4) on formation expenses and on tangible and intangible fixed assets b) oncurrentassets 5. Other operating charges 6. Value adjustments and fair value adjustments.on financial fixed assets 7. Value adjustments and fair value adjustments on financial current assets. Loss on disposal of transferable securities. 8, Interest and other financial charges 2) concerning affliated undertakings +b) other interest and charges 9, Extraordinary charges 10.tneome tax 1, Other taxes not included in the previous caption 12, Profit for the financial year/period eee ‘Total Charges “he accompany note fom an tga pat ofthe anual acount Hondbook forthe preparation of annus! secounts under Luxembourg accounting framework 28Name of the company Ret article Profit and loss account for the year ended ... (balance sheet date)/ offaw for the period from.... to... (balance sheet date) ‘Denominated in (currency in which the capital is denominated - or other selected currency) Kotet) Nona % B. INCOME (eurreney)_ (curren) oy 1. Netturnover 2, Change in inventories of finished goods and of work and contracts in progress 3, Fixed assets under development 4, Reversal of value adjustments 2) on formation expenses and on tangible and intangible fixed assets } oncurrentassets 5. Other operating income 6. Income from financial fixed assets | 2) derived from affliated undertakings 1) other income from participating interests 7, Income from financial current assets 2) derived from affliated undertakings B otherincome 8. Other interest and other financial income 2) derived from affliated undertakings 1) other interest and financial income 9. Extraordinary income 12.Loss for the financial year/period. se e Total Income : fh ‘he secomparying notes form a rtp pt of tate an! account Pwr Lixembourg| a Ref. article oflaw 26) 26) 2615) 66 I Notes to the annual accounts' ‘The notes to the accounts, which form an integral part of the annual accounts, are essential as they provide further clarification on the balance sheet or the profi and loss account. In addition, their purpose is tohelp the reader to make an informed judgement on the figures provided. Asa general practice, the notes to the accounts should include the following components: 2) Description ofthe business of the undertaking and other general information; ) Description ofthe general accounting policies, principles and valuation rules adopted by the undertaking; ©) Details on certain items, being a description either required by the Law, or necessary fora better understanding by the reader of the annual accounts. ‘Where the application ofthe provisions set out in Chapter If of Title If ofthe Law would notbe sufficient to give a true and fair view, additional information must be provided. ‘Where in exceptional cases the application of a provision of Chapter I of the Law is incompatible with the obligation of true and fair view, that provision must be derogated from to givea true and fair view. Any such derogation mustbe disclosed in the notes to the accounts, together with an explanation of the reasons foritand. statement ofits effect on the assets, liabilities, financig] position and profit or loss of the company. Abridged notes to the accounts ‘The undertakings referred to in article 35 (small-sized companies which have not issued transferable securities ona European regulated stock exchange’) may draw up abridged notes to their accounts without the {information required in article 65 paragraph (1) 5° to 12%, 16° and 17°a). However, the notes tothe aecounts must give the information specified in article 65 paragraph (1) 6" in total fora the items concerned. ‘These undertakings are also exempt from the obligation to disclose in the notes to their accounts the information set forth in article 39 paragraph (3) a) and paragraph (1), article 49 paragraph (2), article 50, article 53 paragraph (2, article 62 paragraph (2), article 64 second paragraph and article 65 paragraph (1) 14. ‘Pursuant to article 65 (1) 7bis" and article 65 (1) 7ter, except for companies for which transferable securities are «quoted on a European regulated stock exchange small-sized companies can limic the information tobe given ‘on operations not recorded in the balance sheet to the nature and the commercial objective ofthese operations, ‘and omitto disclose significant related parties operations® not concluded at arms length, Inthe examples of notes provided hereafter, articles and paragraphs not mandatory for small-sized entities are inbold. 1 Ben hah futheron inthis pubes, te word "Careany” cust forthe ferent notes othe scout, west keg in i ta the Pcpario oe reas othe arousal sola to the urdeaknge fered ton a 28, Le ngvicas who we slereomers Ores Ed trananceoforlgn undensleg® as asta repo he ar "compar by “unaetang 2 Ready apne pe tb incre OV ENE te EanpotPaaret rd na Court 21 A204 on meats 5 ie fre af Sted by reference to IAS 24 Th exes fo dose eld paris rancacons not done at ss nigh net eppestio ‘Sennen casa | pungagh ota nctng aces oc yew cur wich casos ea inpary sats sn sarod, a pany sed he mons he sete, menapaal and auperigry bos. Handbook forthe preparation of annul sccounts under Luxembourg accounting framework 25r Notes to the annual accounts (cont.) Ref. article ofLaw NOTEX- GENERAL INFORMATION (QName of the company) (hereafter the “Company”) was incorporated on date of incorporation) and is organised under the laws of Luxembourg asa (legal form) for an unlimited periodfor a period of... ears. ‘The registered office of the Company is established in (town, country). ‘The Company's financial year starts on... and ends on ... ofeach year. ‘The main activity of the Company is. Ifthe Company consolidates* ‘The Company also prepares consolidated financial statements, which are published according to the provisions ofthe Luxembourg law? Ifthe Company does not consolidate? 313* 316" Based on the criteria defined by Laneembourg law, the Company is exempt from the obligation to draw up consolidated accounts and a consolidated management report forthe year/period ended (balance sheet date). ‘Therefore, i accordance with the legal provisions, these annual accounts were presented on a non-consolidated basis for the approval of the shareholders/partners during the Annual General Meeting® If the annual accounts of tte Company are inchuded in the consolidated accounts ofthe parent _ company i 65(15° ‘The Companyis inched inthe consolidated accounts of (name of the company which consolidates) forming the largest body of undertakings of which the Company forms apart asa diret/indirect subsidiary ‘undertaking. The registered office of that company is located (address of the company which consolidates) and the consolidated financial statements are available at. emis {In addition, the Company is included in the consolidated accounts of (name of the company which consolidates) forming the smallest body of undertakings included inthe body of undertakings referred ton the above- ‘mentioned paragraph of which the Company forms part asa subsidiary undertaking. The registered office of ‘that companys located (address ofthe company which consolidates) and the consolidated accounts are available a..° or i 651s ‘The Company is included in the consotidated accounts of (name ofthe company which consolidates) forming at | ‘once the largest and the smallest body of undertakings of which the Company forms a partasadirect/indirect | subsidiary undertaking, The registered office ofthat company is located (address of the company which 1 consolidates) and the consolidated accounts are available at." i etrto he desoreton declecd inthe Company’ arse of ascaton:ue th mn par —te snl acts gorraly inde nthe (er of sono cn gre ‘Soket ov appropriate ‘Te pragrsoh apicable ithe Campany nao prepare consoled her ststrarts ei pubes frarcil statements prepare on 8 velar Sst (iio Crd Law of 10 August 1215. ‘Tue paragon eapleae aly to Company ade sublsaris form = run accocing to 09 th amended lw o 10 Aug 18150) ‘ry be xem fmm ts osiguen to aw up cosas accra ecatang tan Sto 316 othe ‘ “Fa 2aragiaeh ay be shown oy hese aceauns fa Cmpeny a nud nf corenidte account tbe pare corey. ‘Company hear tha ng eotecited escort fa parent osmpany repo ot Re suo andthe corealdaed management epor = publ inh ar provided for a cf the smn aw of 10 dupa 4 oe egures byw S106. 26 PweLuemboug |Ref. article of Law 28/29 (4) es@r 26 51 64bis: 64sexies 530) a) T Notes to the annual accounts (cont.) NOTEX~ PRESENTATION OF THE COMPARATIVE FINANCIAL DATA ‘The figures for the year/period ended (balance shect date N-1) relating to items .. have been reclassified to censure comparability with the figures for the year/period ended (balance sheer date N)'. NOTEX- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES X-1 Basis of preparation ‘The annual accounts have been prepared in accordance with Luxembourg legal and regulatory requirements under the historical cost convention (except forthe use ofthe fair value option for financial instruments and/or other certain categories of assets). Accounting policies and valuation rules are, besides the ones laid down by the Law of 19 December 2002, determined and applied by the Board of Directors/Managers/Management. “The preparation of annual accounts requires the use of certain critical accounting estimates, Italso requires the Board of Directors/Managers/Management to exercisejts/their judgement in the process of applying the accounting polices, Changes in assumptions may have a significant impact on the annual accounts in the period {in which the assumptions changed, Management believes thatthe underlying assumptions are appropriate and that the annual accounts therefore present the financial postion and results fairly. ‘The Company makes estimates and assumptions that affect the reported amounts of assets and liabilities in the next financial year, Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. X.2 Significant accounting policies ‘The main valuation rules applied by the Company are the following: X.2.1 Formation expenses? ‘The formation expenses of the Company are directly charged to the profitand loss account ofthe year/period in which they are incurred. ort Formation expenses are written off on a straight-line basis over a period of (XX years, YY months). 1 Tisparagaph witb shown nthe rte othe account i austents we made to the croaratve fare fr ta pecan yar hese | ebro rae nde eceprs euncars comrg mas ato 5 Fomaton srpenos +i clgnion ova fomaton exec nr ‘Aet yao. fit para cea eves, te eons «Thyme om writen sf within s maxim pared ef fv yours, 4 hoofs ertrexparsa aver ea corey win to atouten of profs shal ike place nls ho aunt fhe ees {Dalai or Serousen sed ott rah forwetél at aet equl at of he xpanene cov writ o 53 (Eh. Handbook forthe preparation of annual accounts under Luxembourg accounting framework 27Ref. article of Law 55@) 59) 59@) 28° PwC Luxembourg . Notes to the annual accounts (cont.) X.2.2 Intangible fixed assets! Intangible fixed assets are valued at purchase price including the expenses incidental thereto or at production cost, less cumulated depreciation amounts written off and value adjustments. These value adjustments are not continted ifthe reasons for which the value adjustments were made have ceased to apply”. ' | ‘The depreciation rates and methods applied are as follows: | Research and development costs* Concessions, patents, licences, trademarks and similar rights and assets . for cosh X.2.3 Tangible fixed assets, i Historical cost modet I ‘Tangible fixed assets are valued at purchase price including the expenses incidental thereto or at production cost, Tangible fixed assets are'depreciated over their estimated useful economiclives. ‘The depreciation rates and methods applied are as follows: Depreciation Landis not systematically depreciated. ‘Where the Company considers that a tangible fixed asset has suffered a durable depreciation in value, an ‘additional write-down is recorded to reflect this loss. These value adjustments are not continued ifthe reasons for which the value adjustments were made have ceased to apply®. ors 4 Aspera tse, tne had accel cn alt bo a vale. Fo ramp of oe, plas aero tenga he ans 2 il auste ae aec fo ecapionn vat noustent fr tmatn purpose, he amour ! ha nausea reason for ma ‘hom must be dedosta nh ols fo the accbuts ft 351) My epid meds f copeccton we gored nner nefhaceanasmamiescictissa 5 Thegeotil rat be writen of win a aman par fs yeu. However somoarge ay usc good serail ovr 8p? resting eyo, pode at tha arn does at noun he ust ite Paget Vere a open sere et a shal bs (Seoceedmna isto the acsous oper wie eaors eee 8 Saet a apron,Ref.article ofLaw a] 554 60 550) @) f Notes to the annual accounts (cont.) Fair value model! ‘Tangible fied assets are initially recorded at purchase price including the expenses incidental thereto or at production cost. They are subsequently valued at fair value determined on the following basis (description of valuation method used). The unrealised gains and losses for the year are recorded in the profit and loss account/ revaluation reserves. Where applicable? Interest on capital borrowed to finance the production of fixed assets has been included in the production cost to the extent to which it relates to the period of production. ‘Where applicable? ‘Tangible fixed assets which are constantly being replaced and whose overall value is of secondary importance to the Company are shown under “Assets” ata fixed quantity and value ifthe quantity, value and composition thereof donot vary materially. X.2.4 Fixed assets developed by the Company itself The costs incurred on fixed assets under development cygated by the Company itself are recorded inthe profit and loss account under caption “Fixed assets under development” during the year and are transferred at balance sheet date to the appropriate balance sheet caption, Interest on funds borrowed to finance the production is taken into account in the cost and is captalised?, X.2.5 Financial fixed assets Historical cost model ‘Valuation at purchase price Shares in affiliated undertakings/participating interests'loans to these undertakings/securities held as fixed assets/other loans are valued at purchase price/nominal value (loans and claims) including the expenses incidental thereto, Inthe case of durable depreciation in value according tothe opinion of the Board of Directors/Managers/ ‘Management, value adjustments are made in respect of fixed assets so that they are valued atthe lower figure to be attributed to them at the balance sheet date, These value adjustments are not continued ifthe reasons for ‘which the value adjustments were made have ceased to apply’ 4 Theta value option canbe used for orn catogoies of assets eno should dese the ators cxncenad 2 Some on envoy, 5 "arto eres shal mean itis In to cops fete undechings, hea of not rereerd by etfs, which bycetng 2 uri wt hoe uncoating, re rtandad fo corti othe unsataur aeties. The Pcldg of prt of teal of wot eompary ‘Sal be precumod ig corstut a paripaing hires What crcgose 20 fa 4) 4 Tee eats ao gtr tg ecopteal vals adios Er tera purposes done, te aout ofthe adhusiments andthe recone for mang {ham mustbe dale nthe noone socounes rt 65) Handbook forthe preparation of annual accounts under Luxembourg accounting framework 2930 Ref. article ofLaw 551) aa) we Luxambourg Notes to the annual accounts (cont.) oF ‘Valuation at the “lower of cost ormarket value” Shares in affiliated undertakings/participating interests are valued atthe lower of purchase price including the expenses incidental thereto or the market value. Loans shown under “Financial assets” are recorded at their ‘nominal value. A value adjustment is recorded where respectively for securities and loans the matket value (Gecurities) and/or recovery value (loans) is lower than the purchase price and/or nominal value. Market value and/or recovery value corresponds to: * Thelast available quote on the valuation day for securities listed ona stock exchange or traded on another regulated market, ‘+ The probable market or recovery value estimated with due care and in good faith by the Board of Directors’ ‘Managers/Management, without setoff of individual gains and losses in value, forunlisted securities or securities that are not traded on another regulated market, for securities listed on a stock exchange or traded | cn another regulated market where the latest quote is not representative, as well as fr the loans shown unde sasen” oF Valuation under the net equity method Shares n affliated undertakings/participating interests are valued atthe amount corresponding to the proportion of the capital and réserves of these undertakings. f : Initial recognition : Acthe date of acquisition, the shares in affliated undertakings/participating interests are recorded at cost. The | difference between the proportion of capital and reserves and the cost disclosed in the notes. The capital and | reserves have been valued according to the accounting rules applied by the Company®. oF Atthe date of acquisition, the shares in afiliated undertakings/participating interests are recorded at the ‘amount corresponding to the proportion of the capital and reserves represented by the affiliated undertakings/ | participating interests, The capital and reserves have been valued according to the accounting rules applied by | the Company’. Ifthe positive difference calculated is not attributable to a category of assets or liabilities tis then accounted for as goodwill and amortised over a period of five years. Subsequent measurement Annually, the proportion ofthe net profit or loss attributable to the shares in affliated undertakings/ ‘participating interests is shown in the profit and loss account on a separate line item. An unavailable reserve for | distribution is booked in equity forthe portion ofthe result above the amount of dividends already received or the payment of which can be claimed. or ‘Annually the proportion of che net profit or loss attributable tothe shares in affiliated undertakings/ | participating interests is directly booked in equity under revaluation reserves except forthe potion of dividends already received or the payment of which can be claimed, These revaluation reserves are not availbl, for dstbution. | 1 Stet sppropct, 2 SSacpathg erst chal mean ifs no capt of othr undaraings, hata ot rgroona by cefcate, wie, by renin & urbe in wth tooo uncorac, arrtordod to corr otha ungatatngs sce. Th tng of pat ol he ea of rca Sat bs precomed'ig consis partpaingMorost whe korea 20% rt 4) ‘3 hare tho vhs Ras rot Bean mad, Geese must ba ade Mth nos io accounts ot. 58Ref. article ofLaw bis (Sbis) E e4bis a a 5503) a 2 35) @) r Notes to the annual accounts (cont.) ort Fair valuemodel Shares in aflliated undertakings/participating interests Shares in affiliated undertakings/participating interests are initially recorded at purchase price including the expenses incidental thereto, They are subsequently valued at fair value determined on the following basis, escription of valuation method used). ‘The change in fr value is recorded in profit and loss/The change in fair value is recorded in revaluation reserves, while permanent diminution in value is recorded in the profitor loss account. Securities held as fixed assets? Securities held as fixed assets are initially recorded at purchase price including the expenses incidental thereto. ‘They are subsequently valued at fair value determined on the following basis (description of valuation method used). ‘The unrealised gains and losses forthe year are recorded in the profit and loss/The unrealised gains or losses for the year are recorded inthe revaluation reserves, while permanent diminution in value is recorded inthe profit or loss account X.2.6 Inventories of raw materials and consumables* Inventories ofraw materials and consumables are valued at the lower of purchase price calculated on the basis of weighted average prices/the “firstin, frst out” (FIFO) method/the “last i, first out” (LIFO) method/(other similar methods to be disclosed) or market value. A value adjustment is recorded where the market value is lower than the purchase price, These value adjustments are not continued ifthe reasons for which the value adjustments were made have ceased to apply. Where applicable Raw materials and consumables which quantity, value and composition do not vary materially and which are constantly being replaced and the overall value of which is of secondary importance to the Company are shown, ata fixed quantity and value. X.2.7 Inventories of finished goods and work and contracts in progress Inventories of finished goods and work and contracts in progress are valued at the Iower of production cost {including the purchase price ofthe aw materials and consumables, the costs direct attributable tothe produet/eontractin question and a proportion ofthe costs indirectly attributable tothe product/contract in question, and market value. value adjustment is recorded where the market value is below the production cost. These value adjustments are not continued ifthe reasons for which the value adjustments were made have ceased to apply** 4 Selot oe sopropite 2 The viston method usd shou nthe wth IFRS aan te) ots re lowfat of sara fisted undetang oF «rt el eee wich nancies canbe ecole vl. Tha veut ath ues sublet oa ee 4 Forth veuson ee orton, fe nove sal be sdapoo oe crests is parent ates cry a mest commen case We Seek baton rt ofthe adsrts an th esons or tei ba ne on captn Soro fares os an or ‘Siemans, removes can be messes a ae et keeca)n Ws case ‘5 Hoare stat ae oat rept! va stent nalon psoas de, ‘alin en rut ba dscweain te rots tm soso 6) ah ‘reenlona vas suas ar alowed tare se se rocco oe ba ofa asonbl comer ceserrt prev the ‘slaton of os tare fo having Sa ced ne er tre bce of asta vue The aout hese er cobtnats mst [eclacone pte te pot aren eoour orn ha nots ha eau tO (eh Handbook forthe preparation of annual accounts undor Luxembourg accounting framework SIRef. article ofLaw am 2 Pw Luxembourg 7 Notes to the annual accounts (cont.) X.2.8 Debtors Debtors are valued at their nominal value. They are subject to value adjustments where their recovery is ‘compromised. These value adjustments are not continued ifthe reasons for which the value adjustments were ‘made have ceased to apply'*. I X.2.9 Transferable securities Historical cost model ‘Transferable securities are valued atthe lower of purchase price, including expenses incidental thereto and. calculated on the basis of weighted average prieet/FIFO/LIFO method, orsimilar method tobe disclosed) or | ‘market value, expressed in the currency in which the anmual accounts are prepared. Avalue adjustmentis | record where the market vate is lower than the purchase price, These value adjustments are not continued if; the reasons for which the value adjustments were made have ceased to apply | “The marketvalue corresponds to ‘the latest available quote onthe valuation day for transferable securities listed on a stock exchange or traded ‘on another regulated market, ‘the probable realisation value estimated with due care and in good faith by the Board of Diectors/ ‘Managers/Management for transferable securities not listed ona stock exchange or not traded on another regulated market and for transferable securities listed ona stock exchange ot traded on another regulated i marker where the latest qe is not representative, i ae : Fairvalue model ‘Transferable securities are valued at fair value. The fair value of these financial instruments corresponds to: «+ the latest available quote onthe valuation day for transferable securities listed on a tock exchange or traded on another regulated market; + arealisation value determined by using the following valation techniques (o be disclosed) basedon | assumptions made by the Board of Direcors/Managers/ Management and market conditions existing atthe balance sheer date. .2.10 Derivative financial instruments ' ‘The Company may enter into derivative financial instruments such as options, swaps, futures or foreign | exchange contracts. The Company records initially derivative financial instruments at cost | Historical cost model “Ateach balance sheet date, unrealised losses are recognised in the profit and loss account whereas gains are ‘accounted for when realised. Inthe case of hedging ofan asst or a liability which is not recorded atfair value, ‘unrealised gains or losses are deferred until the recognition of the realised gains or losses onthe hedged item | core sate abject ocelot vale adustmerts fr naton purposes elo th mount ofthe arent de ears or ‘akg an ast ba dacosodn oe rotn oh genie 61 Ch ‘reegtona vse austmars ar leweu wor eer recstny ch bel of reasonable corer set o proven the ‘alin a hse fa om having obs mace inte ran se beraune tutte qv Tho our of toss va cstr=ns Seaiecoses separate pot an ixe exam ete oe re accoans ft 67) 4 Seal ren gaara ee ne rot nos aocunt wares gas ar accourted when ei Ein eeoappy nthe cme Resa.Ref. article ofLaw I Notes to the annual accounts (cont.) or Fair value model® Derivative financial instruments are fair valued based on market value/valuation techniques (to describe). Unrealised gains and losses are recorded in the profit and loss/revaluation reserves*. ‘The market value corresponds to: * the latest available quote on the valuation day for derivatives listed on a stock exchange or traded on another regulated market; + the probable realisation value estimated through the following valuation techniques (tobe disclosed) based ‘on assumptions made by the Board of Directors/Managers/Management and market conditions existing at the balance sheet date. Commitments relating to options/swaps/futures/foreign exchange contracts transactions are recorded in the off-balance sheet accounts. X-2.11 Foreign currency translation : ‘Transactions expressed in currencies other than (currency of the annual accounts) are translated into (currency of the annual accounts) atthe exchange rate effective atthe time of the transaction. Formation expenses and long-term assets expressed in currencies other than (currency of the annual accounts) are translated into (currency of the annual accounts) atthe exchange rate effective atthe time of the transaction. Atthe balance sheet date, these assets remain translated at historical exchange rates. ‘Cash atbankis translated at the exchange rate effective at the balance sheet date. Exchange losses and gains are recorded in the profit and loss account ofthe year/period. (Other assets and liabilities are translated separately respectively atthe lower or at the higher ofthe value converted at the historical exchange rate or the value determined on the basis of the exchange rates effective at the balance sheet date, The unrealised exchange losses are recortied in the profitand loss account. The exchange gains are recorded in the profit and loss account at the moment of their realisation. Where there is an economic link between an asset and a liability, these are valued in total according to the method described above and the net unrealised losses are recorded in the profit and loss account and the net unrealised exchange gains are not recognised, Assets and liabilities items which are fair valued are converted at the exchange rates effective a the balance sheet date. Foreign exchange differences on those items which are accounted at fair value are recognised in the profit and loss account or revaluation reserves with the change in fair value. 4 Seoctas appropriate. 2 The flevaue modal canbe also appiedinaocrdone with IFRS este bya abi Si) 5 AL pera tiation sorts ot altvacncn ious tenn ste aol aia hepsi fa ave esa whan he baked long rege seonuning whch alos somes of aration a vue et to be ooked m prof endow: ihe varaton tase rar van baokod ona monty eran cn part othe el roster of tho Company aT company. ‘slop Pe eters th cove hah enn cre note aa Yea 4 Th Law dost spec exchange tana sh parsraph ano in posse scooting poles bt Sos rec corvmen pacts, Iocan lr eet Daas rac a 15: Tho pareraph may ac fe Companys hadgog sous td azo tesa arsgn caren. Those act i bites should have ha hacnrnes nun, atu ib fr hstanc, appease to baste aact loans ut oto des ang papain Handbook forthe preparation of annual accounts under Luxsmbourg accounting amework $8Ref. article ofLaw 34 Pure Luxembourg Notes to the annual accounts (cont.) a ort Monetary items are converted atthe exchange rates effective atthe balance sheet date whereas non-monetary items are converted atthe exchange rate effective atthe time of the transaction. The realised and unrealised ‘exchange losses are recorded in the profit and loss account. The unrealised exchange gains are recorded ina regularisation account, whereas the realised exchange gains are recorded in the profitand loss account atthe ‘moment oftheir realisation. I ‘Where there is an economic link betwreen an asset and a lability, these are valued in total according to the ‘method described above and the net unrealised losses are recorded inthe profit and loss account and the ‘unrealised exchange gains are booked in a regularisation account until the moment of their realisation*, 'Non-monetary assets and liabilities items which are fair valued are converted at the exchange rates effective at | the balance sheet date. Foreign exchange differences on those items which are accounted at fair value are recognised in the profit and loss account or revaluation reserves with the change in fair value®. X.2.12 Deferred charges ‘This asset tem includes expenditures incurred during the financial year but relating to a subsequent financial vyeat. X.2.13 Capital investment subsidies Subsidies received from the Luxembourg government (other tobe specified) related tothe financing of investments are recorded under "Capital and reserves” at their initial value’. They are written off using the same ‘method and over the same period as the assets to which they relate. X.2,14 Temporarily not taxable capital gains ‘Temporarily not taxable capital gains inchude gains for which the taxation is deferred by virtue of article 53 or | '54LIRS, Such gains, which ae rolled over, are recorded at their initial value. Reinvested gains are written off using the same method and over the same period asthe assets to which they relate, X2.15 Provisions Provisions are intended to cover losses or debts, the nature of which is clearly defined and which, atthe date of the balance sheet, are either likely o be incurred or certain to be incurred but uncertain as to their amount or the date on which they will arise, Provisions may also be created to cover charges which originate in the financial year under review orina previous financial year, the nature of which is clearly defined and which atthe date of the balance sheet are cither likely tobe incurred or certain tobe incurred but uncertain as to their amount or the date on which they willarise. Select 5 appropra, “Thi poragtpn ey Sly tha Company shading seat an bites th ame eaign caren. Those asa end lables soul a Presa, may roars, sees bck bck wes bart todas ena pte. ‘Atratey tho cpl vstment uid canbe deduced recy to be acts o which yee to Ure tot caamantmpataurs Raver binaries momoRef. article ofLaw f Notes to the annual accounts (cont.) Provisions for pensions and similar obligations ‘The Company offers its employees a defined benefit plan and/or a defined contribution plan, Defined beneficplan? For defined benefit plans, the Company pays contributions to publicly or privately administered pension insurance plans on a mandatory or contractual basis. The contributions are recognised as a complementary pension expense when they are due. If contribution payments exceed the contribution due for service, the excess isrecognised as an asset. ‘A defined benefit plan defines an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation. The liability recognised inthe balance sheet in respect of defined benefit pension plans i the present value ofthe defined benefit obligation at the balance sheet date minus the fair value of plan assets. The defined benefit obligation is measured using the projected unit credit method or (scribe the method used). The present value of the defined benefit obligation is determined by discounting the estimated future payments by reference to market yields at the balance sheet date on high-quality corporate bonds that are denominated in the currency in which the benefits willbe paid, and that have terms to maturity approximating to the germs of the related pension lability. ‘Actuarial gains and losses are charged or credited in the profit or loss in the period in which they arise. Past service casts are recognised immediately in the profit or loss. Defined contribution plan’ ‘Adefined contribution planis a pension plan under which the Company pays fixed contributions toa separate entity and has no legal or constructive obligations to pay further contributions ifthe Fund does not hold sufficient assets to pay all employees the benefits relating to employee service inthe current and prior periods. Contributions paid are directly registered inthe profit and loss account during the year they are paid. The commitment ofthe Company is limited to the contributions that the Company agreed to pay into the fund on behalf ofits employees. Provision for taxation urenttax provision Provisions for taxation corresponding tothe difference between the tax liability estimated by the Company and the advance payments for the financial years for which the tax return has not yet been filed are recorded under the caption “Tex debts”, 1 The Law dot not rove for ny cleuton meth forthe provision or parins. This accouting poly nly en ex narod be 1 Elied i ero ola Corpary Handbook forthe preparation of annual accounts under Luxembourg accounting framework 35Ref. article ofLaw 36 PweLuxembourg I Notes to the annual accounts (cont.) or Provisions for taxation corresponding tothe tax lability estimated by the Company for the financial years for ‘which the tax return has not yet been filed are recorded under the caption “Tax debts”. The advance payments are shown in the assets ofthe balance sheet under the “Other receivables” item. Deferred tax provision Deferred income taxis provided in full, on temporary differences arising between the tax bases of assets and liabilities and their carrying amount in the annual accounts. The provisions for deferred taxation include mainly deferred income taxes linked to the revaluation of financial instruments and categories of assets which are accounted for at fair value, Deferred income taxis determined using tax rates and laws which have been enactel or substantially enacted by the balance sheet date and are expected to apply when the deferred tax ability is settled. Deferred tax provisions are recorded under the caption “Provisions for taxation”, ‘The deferred tax assets are recognised up to the amount of deferred tax libilities. The variation of the deferred tax charge is recognised in the profit and loss account or in equity following the accounting treatment of the ‘tem to which it relates. X.2.16 Debts Debts are recorded at their reimbursement value, Where the amount repayable on account is greater than the ‘amount received, the difference is shown as an asset and is written off over the period of the debt based on a linear/actuarial method*.*” ort 5 Where the amount repayable on account is greater than the amountreceived, the differences recorded inthe | profit and loss account when the debtis issued. Subordinated debts Debts are recorded under subordinated debts when their status is subordinated to unsecured debts. X.2.17 Deferred income ‘This Habit item includes income received during the financial year bu lating toa subsequent financial yea | X.2.18 Net turnover ‘The net tumover comprises the amounts derived from the sale of products and the provision of services falling within the Company's ordinary activities, after deductions of sales rebates and value added tax and other taxes directly linked to the turnover. 4 Sara nat ne firnce beeen the rirbureamint wali an! th nna vale shold be amor, A et tho Sey eee argh mia that nar cao, ine afronce mst bo ety wren at wn he att rapa |