225
Annual Report -
2013
-
Vivendi
4
Financial Report | Statutory Auditors’ Report on the Consolidated Financial Statements |
Consolidated
Financial Statements
| Statutory Auditors’ Report on the Financial Statements | Statutory Financial Statements
Note 1. Accounting policies and valuation methods
1.3.3.
Foreign currency translation
The Consolidated Financial Statements are presented in millions of
euros. The functional currency of Vivendi SA and the presentation
currency of the group is the euro.
Foreign currency transactions
Foreign currency transactions are initially recorded in the functional
currency of the entity at the exchange rate prevailing at the date of
the transaction. At the closing date, foreign currency monetary assets
and liabilities are translated into the entity’s functional currency at the
exchange rate prevailing on that date. All foreign currency differences
are expensed, with the exception of differences resulting from
borrowings in foreign currencies which constitute a hedge of the net
investment in a foreign entity. These differences are allocated directly
to charges and income directly recognized in equity until the divestiture
of the net investment.
Financial statements denominated in a foreign currency
Except in cases of significant exchange rate fluctuation, financial
statements of subsidiaries, joint ventures or other associated entities
for which the functional currency is not the euro are translated into
euros as follows: the Consolidated Statement of Financial Position
is translated at the exchange rate at the end of the period, and the
Consolidated Statement of Earnings and the Consolidated Statement
of Cash Flow are translated using average monthly exchange rates for
the period. The resulting translation gains and losses are recorded as
foreign currency translation differences in charges and income directly
recognized in equity. In accordance with IFRS 1, Vivendi elected to
reverse the accumulated foreign currency translation differences
against retained earnings as of January 1, 2004. These foreign currency
translation differences resulted from the translation into euro of the
financial statements of subsidiaries having foreign currencies as their
functional currencies. Consequently, these adjustments are not applied
to earnings on the subsequent divestiture of subsidiaries, joint ventures
or associates, whose functional currency is not the euro.
1.3.4.
Revenues from operations and associated costs
Revenues from operations are recorded when it is probable that future
economic benefits will be obtained by the group and when they can be
reliably measured. Revenues are reported net of discounts.
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1.3.4.1. Canal+ Group
Pay and free-to-air television
Revenues from television subscription services for terrestrial, satellite
or cable pay-television platforms are recognized over the service
period, net of gratuities granted. Revenues from advertising are
recognized over the period during which advertising commercials are
broadcasted. Revenues from ancillary services (such as interactive or
video-on-demand services) are recognized when the service is rendered.
Subscriber management and acquisition costs, as well as television
distribution costs, are included in selling, general and administrative
expenses.
Equipment rentals
IFRIC 4 –
Determining whether an arrangement contains a lease
,
applies to equipment for which a right of use is granted. Equipment
lease revenues are generally recognized on a straight-line basis over
the life of the lease agreement.
Film and television programming
Theatrical revenues are recognized as the films are screened. Revenues
from film distribution and from video and television or pay television
licensing agreements are recognized when the films and television
programs are available for telecast and all other conditions of sale have
been met. Home video product revenues, less a provision for estimated
returns (please refer to Note 1.3.4.4) and rebates, are recognized upon
shipment and availability of the product for retail sale. Amortization of
film and television capitalized and acquisition costs, theatrical print
costs, home video inventory costs and television, and home video
marketing costs are included in costs of revenues.
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1.3.4.2. Universal Music Group (UMG)
Recorded music
Revenues from the physical sale of recorded music, net of a provision
for estimated returns (please refer to Note 1.3.4.5) and rebates, are
recognized upon shipment to third parties, at the shipping point for
products sold free on board (FOB) and on delivery for products sold free
on destination.
Revenues from the digital sale of recorded music, for which UMG has
sufficient, accurate, and reliable data from certain distributors, are
recognized based on their estimate at the end of the month in which
those sales were made to the final customer. In the absence of such
data, revenues are recognized upon notification by the distribution
platform (on-line or mobile music distributor) to UMG of a sale to the
final customer.
Music publishing
Revenues from the third-party use of copyrights on musical compositions
owned or administered by UMG are recognized when royalty statements
are received and collectability is assured.
