Section 2: Consolidated accounts.

The consolidated accounts provided for in this book are prepared using the full consolidation method, the proportional consolidation method or the equity method. In the full consolidation method, the consolidated balance sheet includes the assets and liabilities of the consolidating company, with the exception of the securities of consolidated companies, the book value of which is substituted by all the assets and liabilities constituting the equity of these companies determined…

The consolidated income statement includes: 1° The components: a) The profit or loss of the consolidating company; b) The profit or loss of fully consolidated companies; c) The proportion of the profit or loss of proportionately consolidated companies that represents the interest of the holding company or companies ; 2° The fraction of the result of companies consolidated by the equity method, representing either the direct or indirect interests of…

A company’s goodwill on first consolidation is allocated to the appropriate line items in the consolidated balance sheet; the unallocated portion of this goodwill is recorded under “goodwill” on the assets or liabilities side of the consolidated balance sheet. Goodwill recognised as an asset is taken to income over its useful life. In exceptional cases, where its useful life cannot be reliably determined, it is amortised over a period of…

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…