2014 Registration Document and Annual Financial Report - page 262

Financial Statemements
Consolidated Financial Statements and Notes
5
The tax authorities are challenging the independent valuation of
the Accor Services brands that was used by Accor SA to calculate
the taxable capital gain on the brands contributed at the time of
the Group’s demerger in 2010. They have also queried the alleged
waiver by Accor SA of income due by its wholly-owned Brazilian
subsidiary, Hotelaria Accor Brasil S.A., which they say had corporate
income tax and withholding tax implications. This represents a
relatively minor risk.
Accor SA wrote to the tax authorities in February 2014 and
December 2014 contesting the proposed adjustments, but has
nevertheless recorded a contingency provision of €14.5 million in
its 2014 financial statements.
Note 40.4 Other claims and litigation
In the normal course of its business, the Group is exposed to claims,
litigations and proceedings that may be in progress, pending or
threatened. The Company believes that these claims, litigations
and proceedings have not and will not give rise to any material
costs at Group level and have not and will not have a material
adverse effect on the Group’s financial position, business and/or
results of operations.
NOTE 41
OFF-BALANCE SHEET COMMITMENTS AT DECEMBER 31, 2014
Off-balance sheet commitments have been restated for the effect of applying IFRS 11 by excluding commitments given to and received
by joint ventures. However, commitments given by Accor on behalf of joint ventures are included, in accordance with IFRS 12.
Note 41.1 Off-balance sheet commitments given
Off-balance sheet commitments (not discounted) given at December 31, 2014 break down as follows:
(inmillions of euros)
Less
than 1
year
1 to 5
years
Beyond 5
years
Dec. 31, 2014*
Dec. 31,
2013
Adjusted*
SECURITY INTERESTS GIVEN ON ASSETS
(1)
1
10
63
74
84
PURCHASE COMMITMENTS
(2)
18
51
-
69
40
ƒƒ
Renovation commitment in Germany
(3)
17
-
0
17
29
ƒƒ
Renovation commitment in the United Kingdom
3
-
-
3
-
ƒƒ
Renovation commitment in Ivory Coast
3
-
-
3
-
ƒƒ
Renovation commitment in Switzerland
2
-
-
2
8
ƒƒ
Renovation commitment in the Netherlands
2
-
-
2
12
ƒƒ
Other renovation commitments
(4)
9
14
5
28
34
CAPEX COMMITMENTS
36
14
5
54
83
LOAN GUARANTEES GIVEN
5
32
26
63
65
COMMITMENTS GIVEN IN THE NORMAL COURSE OF BUSINESS
25
152
25
202
122
CONTINGENT LIABILITIES
1
3
0
4
4
TOTAL DECEMBER 31, 2014*
86
262
119
466
TOTAL DECEMBER 31, 2013 ADJUSTED*
107
187
104
398
* In line with IFRS 5, off-balance sheet commitments given by the OnboardTrain Services business are not presented in this note. Off-balance sheet commitments given
by the OnboardTrain Services business amounted to €6 million at December 31, 2013 and €6 million at December 31, 2014.
(1) Security interests given on assets correspond to pledges and mortgages valued at the net book value of the underlying assets.
- Collateral for loans obtained from Banque Cantonale de Genève and UBS in Switzerland, consisting of pledges on all the assets of the Novotel Bern, ibis Bern
and ibis budget Bern.The pledged assets had a total net book value of €17 million at December 31, 2014.
- A repayment guarantee for the mortgage loan from Zürcher Kantonalbank for the purchase of the ibis Basel Bahnhof hotel in Switzerland.The mortgage covers
the hotel’s net book value, in the amount of €11 million at December 31, 2014.
- Bancolombia loan guarantees.These guarantees, in the amount of €25 million, consist of mortgages on the land, buildings, operations and goodwill of the Bogotá
Museo ibis, the Medellín ibis and on Cartagena ibis construction work.
(2) In connection with property development projects:
- €40 million commitment related to a leaseholder and property development contract for the construction of the CanningTown ibis.
- The Group is committed to carrying out €12 million worth of renovation work under the Moorfield contract concerning the management and rebranding of 24 Mercure
units in the United Kingdom.
- €7 million guarantee covering the payment of termination penalties on laundry and uniform-cleaning contracts in Germany.
(3) In connection with development plans in Germany, commitments to carry out work mainly concerned development plans of the ibis and Novotel Arnulfstrasse (€12 million).
(4) Other commitments mainly include €20 million in committed capital expenditure on Australian hotels.
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