As of August 31, 2024, the deferred tax assets arising from tax loss carry-forwards amount to 92 million euros (85 million euros as of August 31, 2023). The increase is mainly due to the partial recognition of 16 million euros of deferred tax assets on previously unrecognized losses in France. The main countries with tax loss carryforwards that have given rise to the recognition of deferred tax assets are Brazil, Germany and France (for these countries, the use of tax losses is unlimited over time). The unrecoverability of deferred tax assets on loss carryforwards was assessed on the basis of a plan for using tax losses within each tax jurisdiction.
Unrecognized deferred tax assets arising from tax loss carry-forwards because their recovery is considered to be uncertain amounted cumulatively to 145 million euros as of August 31, 2024 (194 million euros as of August 31, 2023). The main country with tax loss carryforwards that did not give rise to the recognition of deferred tax assets as of August 31, 2024, is France. For the French tax group, the amount of unrecognized deferred tax assets arising from loss carryforwards and used in Fiscal 2024 amounts to 31 million euros (5 million euro in Fiscal 2023).
Temporary differences in employee-related liabilities relate primarily to post-employment benefits.
A provision is recognized if the Group has a legal or constructive obligation at the closing date and it is probable that settlement of the obligation will require an outflow of resources and the amount of the liability can be reliably measured.
Provisions primarily cover commercial, employee-related and tax-related risks and litigation (other than those related to income tax) arising during the course of operating activities, and are measured using assumptions that take account of the most likely outcomes.
Where the effect of the time value of money is material, the amount of the provision is determined by discounting the expected future cash flows at a pre-tax discount rate that reflects current market assessments of the time value of money and any risks specific to the liability.
A provision for onerous contracts is established where the unavoidable costs of meeting the obligations under a contract exceed the economic benefits expected to be received under it.
| (in million euros) | AUGUST 31, 2023 | INCREASES | REVERSALS WITH UTILIZATION | REVERSALS WITHOUT UTILIZATION | CURRENCY TRANSLATION ADJUSTMENT AND OTHER | AUGUST 31, 2024 |
|---|---|---|---|---|---|---|
| Contract termination and loss-making contracts | Contract termination and loss-making contracts AUGUST 31, 202325 |
Contract termination and loss-making contracts INCREASES10 |
Contract termination and loss-making contracts REVERSALS WITH UTILIZATION(1) |
Contract termination and loss-making contracts REVERSALS WITHOUT UTILIZATION(16) |
Contract termination and loss-making contracts CURRENCY TRANSLATION ADJUSTMENT AND OTHER23 |
Contract termination and loss-making contracts AUGUST 31, 202441 |
| Employee claims and litigation | Employee claims and litigation AUGUST 31, 202342 |
Employee claims and litigation INCREASES13 |
Employee claims and litigation REVERSALS WITH UTILIZATION(5) |
Employee claims and litigation REVERSALS WITHOUT UTILIZATION(5) |
Employee claims and litigation CURRENCY TRANSLATION ADJUSTMENT AND OTHER— |
Employee claims and litigation AUGUST 31, 202445 |
| Tax and social security exposures | Tax and social security exposures AUGUST 31, 202329 |
Tax and social security exposures INCREASES2 |
Tax and social security exposures REVERSALS WITH UTILIZATION(3) |
Tax and social security exposures REVERSALS WITHOUT UTILIZATION(8) |
Tax and social security exposures CURRENCY TRANSLATION ADJUSTMENT AND OTHER— |
Tax and social security exposures AUGUST 31, 202420 |
| Reorganization costs(2) | Reorganization costs (2)AUGUST 31, 202319 |
Reorganization costs (2)INCREASES16 |
Reorganization costs (2)REVERSALS WITH UTILIZATION(14) |
Reorganization costs (2)REVERSALS WITHOUT UTILIZATION(4) |
Reorganization costs (2)CURRENCY TRANSLATION ADJUSTMENT AND OTHER— |
Reorganization costs (2)AUGUST 31, 202417 |
| Client/supplier claims and litigation | Client/supplier claims and litigation AUGUST 31, 202323 |
Client/supplier claims and litigation INCREASES2 |
Client/supplier claims and litigation REVERSALS WITH UTILIZATION(4) |
Client/supplier claims and litigation REVERSALS WITHOUT UTILIZATION— |
Client/supplier claims and litigation CURRENCY TRANSLATION ADJUSTMENT AND OTHER(5) |
Client/supplier claims and litigation AUGUST 31, 202416 |
| Negative net assets of associates(3) | Negative net assets of associates (3)AUGUST 31, 20237 |
Negative net assets of associates (3)INCREASES— |
Negative net assets of associates (3)REVERSALS WITH UTILIZATION— |
Negative net assets of associates (3)REVERSALS WITHOUT UTILIZATION— |
Negative net assets of associates (3)CURRENCY TRANSLATION ADJUSTMENT AND OTHER(1) |
Negative net assets of associates (3)AUGUST 31, 20246 |
| Other provisions | Other provisions AUGUST 31, 202344 |
Other provisions INCREASES14 |
Other provisions REVERSALS WITH UTILIZATION(12) |
Other provisions REVERSALS WITHOUT UTILIZATION(17) |
Other provisions CURRENCY TRANSLATION ADJUSTMENT AND OTHER— |
Other provisions AUGUST 31, 202429 |
| TOTAL PROVISIONS | TOTAL PROVISIONSAUGUST 31, 2023189 | TOTAL PROVISIONSINCREASES57 | TOTAL PROVISIONSREVERSALS WITH UTILIZATION(39) | TOTAL PROVISIONSREVERSALS WITHOUT UTILIZATION(50) | TOTAL PROVISIONSCURRENCY TRANSLATION ADJUSTMENT AND OTHER17 | TOTAL PROVISIONSAUGUST 31, 2024174 |
(1) Reclassification of provisions for contract termination related to healthcare activity previously shown as accrued payable for 18 million euros.
(2) Provisions for reorganization mainly correspond to rationalization costs resulting from the reorganization of the Group.
(3) Investments in companies accounted for using the equity method that have negative net assets (see note 8).
| (in million euros) | AUGUST 31, 2022 | INCREASES | REVERSALS WITH UTILIZATION | REVERSALS WITHOUT UTILIZATION | CURRENCY TRANSLATION ADJUSTMENT AND OTHER | LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1) | AUGUST 31, 2023 |
|---|---|---|---|---|---|---|---|
| Employee claims and litigation | Employee claims and litigation AUGUST 31, 202255 |
Employee claims and litigation INCREASES8 |
Employee claims and litigation REVERSALS WITH UTILIZATION(14) |
Employee claims and litigation REVERSALS WITHOUT UTILIZATION(11) |
Employee claims and litigation CURRENCY TRANSLATION ADJUSTMENT AND OTHER5 |
Employee claims and litigation LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1)(1) |
Employee claims and litigation AUGUST 31, 202342 |
| Tax and social security exposures | Tax and social security exposures AUGUST 31, 202232 |
Tax and social security exposures INCREASES2 |
Tax and social security exposures REVERSALS WITH UTILIZATION(4) |
Tax and social security exposures REVERSALS WITHOUT UTILIZATION— |
Tax and social security exposures CURRENCY TRANSLATION ADJUSTMENT AND OTHER(1) |
Tax and social security exposures LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1)— |
Tax and social security exposures AUGUST 31, 202329 |
| Contract termination and loss-making contracts | Contract termination and loss-making contracts AUGUST 31, 202221 |
Contract termination and loss-making contracts INCREASES22 |
Contract termination and loss-making contracts REVERSALS WITH UTILIZATION(5) |
Contract termination and loss-making contracts REVERSALS WITHOUT UTILIZATION(8) |
Contract termination and loss-making contracts CURRENCY TRANSLATION ADJUSTMENT AND OTHER(5) |
Contract termination and loss-making contracts LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1)— |
Contract termination and loss-making contracts AUGUST 31, 202325 |
| Client/supplier claims and litigation | Client/supplier claims and litigation AUGUST 31, 202237 |
Client/supplier claims and litigation INCREASES7 |
Client/supplier claims and litigation REVERSALS WITH UTILIZATION(8) |
Client/supplier claims and litigation REVERSALS WITHOUT UTILIZATION(13) |
Client/supplier claims and litigation CURRENCY TRANSLATION ADJUSTMENT AND OTHER— |
Client/supplier claims and litigation LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1)— |
Client/supplier claims and litigation AUGUST 31, 202323 |
| Reorganization costs(2) | Reorganization costs (2)AUGUST 31, 202217 |
Reorganization costs (2)INCREASES17 |
Reorganization costs (2)REVERSALS WITH UTILIZATION(11) |
Reorganization costs (2)REVERSALS WITHOUT UTILIZATION(3) |
Reorganization costs (2)CURRENCY TRANSLATION ADJUSTMENT AND OTHER(1) |
Reorganization costs (2)LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1)— |
Reorganization costs (2)AUGUST 31, 202319 |
| Negative net assets of associates(3) | Negative net assets of associates (3)AUGUST 31, 20228 |
Negative net assets of associates (3)INCREASES— |
Negative net assets of associates (3)REVERSALS WITH UTILIZATION— |
Negative net assets of associates (3)REVERSALS WITHOUT UTILIZATION— |
Negative net assets of associates (3)CURRENCY TRANSLATION ADJUSTMENT AND OTHER(1) |
Negative net assets of associates (3)LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1)— |
Negative net assets of associates (3)AUGUST 31, 20237 |
| Other provisions | Other provisions AUGUST 31, 202244 |
Other provisions INCREASES15 |
Other provisions REVERSALS WITH UTILIZATION(8) |
Other provisions REVERSALS WITHOUT UTILIZATION(4) |
Other provisions CURRENCY TRANSLATION ADJUSTMENT AND OTHER5 |
Other provisions LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1)(8) |
Other provisions AUGUST 31, 202344 |
| TOTAL PROVISIONS | TOTAL PROVISIONSAUGUST 31, 2022214 | TOTAL PROVISIONSINCREASES71 | TOTAL PROVISIONSREVERSALS WITH UTILIZATION(50) | TOTAL PROVISIONSREVERSALS WITHOUT UTILIZATION(39) | TOTAL PROVISIONSCURRENCY TRANSLATION ADJUSTMENT AND OTHER2 | TOTAL PROVISIONSLIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE OR FOR DISTRIBUTION(1)(9) | TOTAL PROVISIONSAUGUST 31, 2023189 |
(1) The reclassifications made during the fiscal year correspond to the reclassification of the provisions of the Pluxee (ex Benefits & Rewards Services activity) as liabilities directly associated with assets held for sale or for distribution (see note 3.2).
(2) Provisions for reorganization mainly correspond to rationalization costs resulting from the reorganization of the Group.
(3) Investments in companies accounted for using the equity method that have negative net assets (see note 8).
Provisions for exposures and litigation are determined on a case-by-case basis and rely on management’s best estimate of the outflows deemed likely to satisfy legal or implicit obligations to which the Group is exposed as of the end of the fiscal year.
