The International Financial Reporting Standards (IFRS) are accounting principles and standards intended to improve the comparability and transparency of companies’ financial statements.
The European regulation on international accounting standards requires that for each financial year starting on or after January 1, 2005, companies governed by the law of a Member State of the European Union shall prepare and publish their consolidated accounts in accordance with the International Financial Reporting Standards (IFRS) if their securities are listed on a regulated exchange.
Concession contracts are contracts through which a public authority delegates to private companies the management of public services such as water and energy distribution, waste collection and treatment, transportation. The company manages a large number of concessions for municipal clients, under which it operates assets for a set period, managing all systems. It collects revenue directly from service users or from the municipality and makes the necessary capital investments. At the end of the concession term, all the fixed assets revert to the concession-granting authority.
Under French GAAP, these assets are treated as tangible assets. The IFRS (IFRIC 12) require that theses assets be treated as either financial receivables, when Veolia as an unconditional right to receive cash, or as intangible assets when Veolia has the right to invoice but has not been provided a contractual guarantee in respect of recoverable amount.
Outside the concession contracts mentioned above, the Group manages numerous contracts with municipal and industrial clients through which it operates assets reverted at the end of the contract. In certain cases, Veolia is financing some of theses assets on behalf of its clients, in exchange for future payments. Although these contracts are not from a legal point of view lease contracts, they however imply that the contract operator becomes the lessor of its customers. Veolia therefore applies IFRIC 4 and IAS 17 standards : when the lease transfers the risks and rewards of ownership of the asset in accordance with IAS 17 criteria, the operator recognizes a financial asset to reflect the corresponding financing, rather than an item of property, plant and equipment.
The press releases regarding the fiscal years from 2008 onwards are in the "Press Releases" entry of the site.