BOOK II: Commercial companies and economic interest groupings.

Securities representing the capital of the consolidating company held by consolidated companies are classified according to the use to which they are put in those companies. Long-term securities are shown separately as a deduction from consolidated shareholders’ equity. Marketable securities are maintained in consolidated assets.

Consolidated sales are equal to the amount of sales of products and services related to the current activities of the group formed by the fully consolidated companies. It includes, after elimination of intercompany transactions: 1° The net amount, after any restatements, of sales generated by fully consolidated companies; 2° The share of the holding company or companies in the net amount, after any restatements, of sales generated by proportionally consolidated…

Consolidation requires: 1° The classification of the assets and liabilities as well as the expense and income items of consolidated companies according to the classification plan used for consolidation; 2° The valuation, using the necessary restatements, of the assets and liabilities as well as the expense and income items of consolidated companies according to the valuation methods used for consolidation ; 3° The elimination of the impact on the accounts…

The year-on-year difference arising from the translation into euros of the financial statements of companies denominated in another currency is recorded separately either in consolidated shareholders’ equity or in the consolidated income statement, depending on the translation method used.

The consolidated accounts may be prepared using, in addition to the valuation methods provided for in articles L. 123-18 to L. 123-21, the valuation methods laid down by a regulation of the Autorité des normes comptables. Assets held by organisations that are subject to valuation rules laid down by specific laws may be maintained in the consolidated financial statements at the value resulting from the application of these rules.

The consolidated balance sheet drawn up in accordance with a model laid down by a regulation of the Autorité des normes comptables shall be presented either in tabular form or in the form of a list. It shall at least show separately: 1° In respect of fixed assets: intangible fixed assets, tangible fixed assets, financial fixed assets; 1° bis In respect of current assets: inventories, receivables, marketable securities and cash;…

The consolidated profit and loss account drawn up in accordance with a model established by a regulation of the Autorité des normes comptables (French accounting standards authority) shows at least the net amount of consolidated sales, the profit after tax of all the companies consolidated by the equity method, and the share of profit of companies consolidated by the equity method. The share of minority shareholders or associates and the…

Deferred taxation resulting from: 1° Temporary timing differences between the accounting recognition of income or expenses and their inclusion in the taxable income of a subsequent financial year; 2° Adjustments and eliminations imposed on article R. 233-8, the restatements provided for in c of that article and in particular those induced by the use of the valuation rules of Article R. 233-10; 3° Tax loss carryforwards of companies included in…

In addition to the information provided for in articles L. 233-19, L. 233-23, L. 233-25 and by article R. 233-8, the notes to the financial statements include all material information that enables readers to form a fair assessment of the assets and liabilities, financial position and profit or loss of the group formed by the undertakings included in the consolidation.

Subject to providing proof in the schedule provided for in Article L. 123-12, the companies mentioned in 1° of Article L. 233-17 are exempt from the obligation to draw up consolidated accounts and a report on the management of the group when the following conditions are met: 1° The consolidated accounts of the larger body of undertakings, in which these companies are included, are drawn up in accordance with articles…