Trade are initially recognized at the amount of consideration to which the Group expects to be entitled in exchange for transferring promised goods or services and are subsequently measured at amortized cost less impairment charges recognized in the income statement.
Trade and other receivables are impaired to reflect the expected credit losses, assessed using an impairment matrix (application of the simplified impairment model as provided for in IFRS 9 “Financial instruments”). This method consists of applying for each aging balance category a separate impairment rate based on historical credit losses adjusted, when necessary, to take into account prospective factors.
| AUGUST 31, 2023 | AUGUST 31, 2022 | |||||
|---|---|---|---|---|---|---|
| (in million euros) | GROSS AMOUNT | IMPAIRMENT | CARRYING AMOUNT | GROSS AMOUNT | IMPAIRMENT | CARRYING AMOUNT |
| Advances to suppliers | 12 | — | 12 | 25 | — | 25 |
| Trade receivables | 3,108 | (107) | 3,001 | 4,454 | (160) | 4,294 |
| Other operating receivables | 349 | (9) | 340 | 538 | (21) | 517 |
| Prepaid expenses | 211 | — | 211 | 226 | — | 226 |
| Other receivables | 2 | (4) | (2) | 7 | (1) | 6 |
| TOTAL TRADE AND OTHER CURRENT OPERATING ASSETS | 3,682 | (120) | 3,562 | 5,250 | (182) | 5,068 |
The maturities of trade receivables as of August 31, 2023 and August 31, 2022 were as follows:
| AUGUST 31, 2023 | AUGUST 31, 2022 | |||||
|---|---|---|---|---|---|---|
| (in million euros) | GROSS AMOUNT | IMPAIRMENT | CARRYING AMOUNT | GROSS AMOUNT | IMPAIRMENT | CARRYING AMOUNT |
| Less than 3 months past due | 362 | (5) | 357 | 487 | (11) | 476 |
| More than 3 months and less than 6 months past due | 62 | (11) | 51 | 89 | (12) | 77 |
| More than 6 months and less than 12 months past due | 45 | (23) | 22 | 39 | (7) | 32 |
| More than 12 months past due | 56 | (50) | 6 | 112 | (104) | 8 |
| TOTAL TRADE RECEIVABLES DUE | 525 | (89) | 436 | 727 | (134) | 593 |
| Total trade receivables not yet due | 2,583 | (18) | 2,565 | 3,727 | (26) | 3,701 |
| TOTAL TRADE RECEIVABLES | 3,108 | (107) | 3,001 | 4,454 | (160) | 4,294 |
During the fiscal years presented, the Group was not affected by any significant change resulting from proven client failures. In addition, given the geographic dispersion of the Group’s activities and the wide range of client industries, there is no material concentration of risk in individual receivables due but not written down.
Trade payables are classified as financial liabilities measured at amortized cost, as defined in IFRS 9 “Financial instruments”. Financial liabilities are recognized at their nominal amount, which represents a reasonable estimate of fair value in light of their short maturities.
Sodexo’s group has set up several reverse factoring programs in its main operating countries, which give its suppliers the opportunity of being paid in advance. In practice, these programs involve sales of trade receivables to a factor, organized by Sodexo. Relations between the parties concerned are governed by two totally separate contracts:
Employee-related liabilities mainly include short-term employee benefits (see note 5.1).
