227
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
1.3.5.
Assets
■
■
1.3.5.1. Capitalized financial interest
Until December 31, 2008, Vivendi did not capitalize financial interest
incurred during the construction and acquisition period of intangible
assets, and property, plant and equipment. Since January 1, 2009,
according to amended IAS 23 –
Borrowing Costs
, this interest is
included in the cost of qualifying assets. Vivendi applies this amendment
to qualifying assets for which the commencement date for capitalization
of costs is January 1, 2009 onwards.
■
■
1.3.5.2. Goodwill and business combinations
Business combinations from January 1, 2009
Business combinations are recorded using the acquisition method.
Under this method, upon the initial consolidation of an entity over which
the group has acquired exclusive control:
the identifiable assets acquired and the liabilities assumed are
recognized at their fair value on the acquisition date; and
non-controlling interests are measured either at fair value or at the
non-controlling interest’s proportionate share of the acquiree’s net
identifiable assets. This option is available on a transaction-by-
transaction basis.
On the acquisition date, goodwill is initially measured as the difference
between:
(i)
the fair value of the consideration transferred, plus the amount
of non-controlling interests in the acquiree and, in a business
combination achieved in stages, the acquisition-date fair value of
the previously held equity interest in the acquiree; and
(ii)
the net fair value of the identifiable assets and liabilities assumed
on the acquisition date.
The measurement of non-controlling interests at fair value results
in an increase in goodwill up to the extent attributable to these
interests, thereby leading to the recognition of a “full goodwill”. The
purchase price allocation shall be performed within 12 months after
the acquisition date. If goodwill is negative, it is recognized in the
Statement of Earnings. Subsequent to the acquisition date, goodwill is
measured at its initial amount less recorded accumulated impairment
losses (please refer to Note 1.3.5.7 below).
In addition, the following principles are applied to business
combinations:
on the acquisition date, to the extent possible, goodwill is allocated
to each cash-generating unit likely to benefit from the business
combination;
contingent consideration in a business combination is recorded at
fair value on the acquisition date, and any subsequent adjustment
occurring after the purchase price allocation period is recognized in
the Statements of Earnings;
acquisition-related costs are recognized as expenses when incurred;
in the event of the acquisition of an additional interest in a
subsidiary, Vivendi recognizes the difference between the
acquisition price and the carrying value of non-controlling
interests acquired as a change in equity attributable to Vivendi SA
shareowners; and
goodwill is not amortized.
Business combinations prior to January 1, 2009
Pursuant to IFRS 1, Vivendi elected not to restate business combinations
that occurred prior to January 1, 2004. IFRS 3, as published by the IASB
in March 2004, retained the acquisition method. However, its provisions
differed from those of the revised standard on the main following items:
minority interests were measured at their proportionate share of
the acquiree’s net identifiable assets as there was no option of
measurement at fair value;
contingent consideration was recognized in the cost of acquisition
only if the payment was likely to occur and the amounts could be
reliably measured;
transaction costs that were directly attributable to the acquisition
formed part of acquisition costs; and
in the event of the acquisition of an additional interest in a
subsidiary, the difference between the acquisition cost and the
carrying value of minority interests acquired was recognized as
goodwill.
■
■
1.3.5.3. Content assets
Canal+ Group
Film, television or sports broadcasting rights
When entering into contracts for the acquisition of film, television
or sports broadcasting rights, the rights acquired are classified as
contractual commitments. They are recorded in the Statement of
Financial Position and classified as content assets as follows:
film and television broadcasting rights are recognized at their
acquisition cost, when the program is available for screening and
are expensed over their broadcasting period;
sports broadcasting rights are recognized at their acquisition cost, at
the opening of the broadcasting period of the related sports season
or upon the first payment and are expensed as they are broadcast;
and
expensing of film, television or sports broadcasting rights is included
in cost of revenues.
