Vilmorin & Cie - Annual report 2017-2018

5 ANNUAL REPORT Vilmorin & Cie 211 2017-2018 5.1.6. Statutory Auditors’ report on the consolidated financial statements Fiscal year closing June 30, 2018 To the Shareholders of the Company Vilmorin & Cie SA, Opinion In compliance with the assignment entrusted to us by your Shareholders’ Annual General Meeting, we have conducted the audit of the consolidated financial statements of the Company Vilmorin & Cie S.A. concerning the fiscal year closing on June 30, 2018 as they are appended to this report. We certify that the consolidated financial statements give a true and fair view of the results of operations for the year ended June 30, 2018 and of the financial position and assets and liabilities at the end of the fiscal year of the persons and entities included in the consolidation in accordance with IFRS standards as adopted by the European Union. The opinion expressed above is consistent with the content of our report to the Audit and Risk Management Committee. Basis of the opinion Audit standards We have conducted our audit in accordance with the professional standards applicable in France. We believe that the information we have gathered is sufficient and appropriate to form our opinion. Our responsibilities under these standards are set out in the “Statutory Auditors’ Responsibilities relating to the audit of the consolidated financial statements” section of this report. Independence We have carried out our audit mission in compliance with the independence rules applicable to us, over the period from July 1, 2017 to the date of issue of our report, and in particular we have not provided services prohibited by article 5, paragraph 1, of regulation (EU) No. 537/2014 or by the code of ethics of the auditing profession. Justification of assessments - Key audit points In accordance with the requirements of Articles L.823-9 and R.823-7 of the French Commercial Code relating to the justification of our assessments, we bring to your attention the key points of the audit relating to the risks of material misstatement which, in our professional judgment, were the most significant for the audit of the consolidated financial statements for the fiscal year, as well as the answers that we have provided with regard to these risks. These assessments were made in the context of the audit of the consolidated financial statements taken as a whole and the formation of our opinion expressed above. We do not express an opinion on individual items in these consolidated financial statements. Evaluation of goodwill and germplasm Notes 1.3, 1.9, 1.11, 14 and 15 to the consolidated financial statements Risk identified On June 30, 2018, the values of goodwill and germplasm for the group stood respectively at 368.9 million euros and 268.6 million euros within the total balance sheet of 2,895.6 million euros. Bearing in mind that it needs to be kept permanently in good condition, regularly maintained and continually used in the process of plant breeding, the Management considers that its economic life is indefinite. These intangible assets with an indefinite economic life were recognized during external growth operations, and were allocated to Cash Generating Units (CGUs) for the activities in which the acquired companies were integrated. In particular, germplasm, measured at fair value through business combinations, consists of all plant resources acquired. As stipulated in Notes 1.9.2 and 1.9.4, every fiscal year the goodwill and germplasm are tested to insure that their book value is not higher than their recoverable value, and that there is no risk of impairment. We considered that the value of these intangible assets is a key point of the audit due to its significant importance in the group’s financial statements and the method of determining their recoverable amount, most often based on discounted cash flow forecasts, which require the use of assumptions, estimates or assessments by management, as indicated in Notes 1.3 and 1.11 to the consolidated financial statements. The methods used to test for impairment are described in Note 1.11 and the details of the assumptions used are presented in Notes 14 and 15. 5.1. Consolidated Financial Statements Financial INFORMATION