Group Accounting & Reporting

1. OBJECTIVE AND SCOPE

1.1   Objective of this Procedure

This procedure describes purpose of ACTUAL0 reporting category and how it is managed in BFC, as well as other related customizing in other BFC modules.

This procedure applies to the BFC Administration team.

2. REFERENCE DOCUMENTS

3. DEFINITIONS

GAR Team - Group Accounting & Reporting Team (Consolidation & Tax team)

FSL BFC-Admin Team  - Team administrating BFC SCO (Solvay Syensqo Group Consolidation tool) in SU FA from FSL (Finance Service Line)

General Group Secretary - Team from Legal Corporate communicating changes on SolvaySyensqo's shareholding structure (new or change in ownership, mergers, divestments, liquidations...) and managing companies' codifications in both ERP and BFC

FSL CAM -  Company Account Manager in FSL (Finance Service Line) 

FSL SU FA GL - General Ledger team from Service Unit "Financial Accounting" in FSL (GBS Finance Service Line)

IG - Full Fully Consolidated method

IP - Proportional Consolidation method

ME - Equity Method

NC - Not Consolidated

CBCR - Country By Country Report (external OECD requirement)

4. SUMMARY 

4.1 Purpose and Content 

The deliverables from the ACTUAL0 data collection are :

• Solvay Syensqo Group shareholding structure – updated and published in  GAR SYENSQO AODOC team site Solvay Syensqo Shareholding Structure
• The financial valuation of the non consolidated companies at Group level (vs Group consolidated figures).
• The local equity of legal companies for dividend valuation purposeThe « Country By Country Report (CBCR)" requested by the OECD

Process Owners (POW):

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Depending on the consolidation method (IG - IP - MEQ - NC) of the reporting companies, the content of their ACTUAL0 reporting package may differ:

Consolidated Companies (IG/IP/MEQ conso methods)

• L4005 schedule "Investment (number)" - reports thenumber of shares that the reporting company (as Mother) owns in each of its affiliate (Daughters), as well as the the number of shares that the affiliate has issued, then it is possible to know the percentage owned by the mother. each of the Mother (s). If there is any variance compared to opening balance, it is explained by flow
• L4000 schedule "Local Gaap equity for dividends valuation" - reports the Dec Y-1 statutory equity information needed to evaluate the dividends distribution at Group level
• L4020 schedule "Shareholder's equity" - reportsthe numbers of shares issued by the Daughter company, split per its Mother companies. If there is any variance compared to opening balance it is explained by flow
• L4060 schedule "CBCR - Revenues and Headcount" - reports 1) the detail of Revenues (not limited to the sales of products) included in the IFRS Dec Y-1 Income Statement with a split per Interco partners and 2) Headcounts - 1st upload in June

Not Non Consolidated (NC) Companies

• L4005 schedule "Investment (number)" - same content and reporting principles as for Consolidated companies - To be noted that in most of cases, the Not Non Consolidated companies do not own affiliates
• L4020 schedule "Shareholder's equity" - reportsthe numbers of shares issued by the Daughter company, split per its Mother companies. If there is any variance compared to opening balance it is explained by flow
• L4050 schedule "Financial information" – reports the summarized Dec Y-1 Financial Statements (consistent with published annual accounts approved by Board of Shareholders and with equity value after dividends distribution), headcounts and external auditors names
• Note that L4060 schedule "CBCR - Revenues and Headcount" is not requested for NC companies (information needed for CBCR captured through their L4050 schedule)

4.1 Reporting Calendar Purpose

4.1 Reporting Calendar Purpose

Depending on their consolidation status and depending on the Depending on their consolidation status and depending on the quarterly reporting period, ACTUAL0 data to be updated and published are different:

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Permanent instructions on ACTUAL0 Reporting are issued every year by FSL SU FA team and published in  Syensqo GAR team Team site "Permanent Instructions" folder, and also inserted in Quarterly GAR closing instructions:

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• General Group secretary: collects and communicates changes in the Solvaythe Syensqo's shareholding structure (new or change in ownership, mergers, divestments, liquidations...) 
• GAR teamTeam:
  • communicate changes in Solvay Syensqo Shareholding structure  through its Structure File in  in  GAR SYENSQO AODOC - "Solvay Syensqo structure files"
  • analyzes ACTUAL0 inputs (Local equity for dividends valuation)
  • uses ACTUAL0 consolidated data (Financial Information on NC companies  / Shareholding tree) to build appendices from the Annual report
• BFC Administration team maintains maintains and updates ACTUAL0 reporting category (packages generation, consolidation creation, scheduling and run,  mass lock/unlocks, on demand unlocksrun)
• CAM enters the information for the companies under his/her scope:
  • for NC companies: CAM or CAM from the Mother company
  • for CBCR, existing interfaces from Solvay ERP's
• FSL SU FA GL is responsible to perform the quarterly checks on ACTUAL0 data (number of shares declared by Mothers /& Daughters on Shareholding structure)Control on CBCR data also performed inside FSL) and to manage mass lockings & unlockings

At the beginning of the year, ACTUAL0 category has to be created for the current year. By principle, there is only one category per year, using one single December period (ACTUAL0 - YYYY.12).

Package generation :

• Starts with should correspond to the perimeter published in the Y-1 annual report with the following updates:
• Companies sold / liquidated / merged in Y-1 => no pack to be created
  • CBCR (based on Y-1 / IG IP MEQ) not needed. If any need, data can be collected out of ACTUAL0
  • Financial data on Non Conso (based on Y-1) not needed by GAR
• Companies entering in the scope in Y (new acquired), package should be generated as soon as the company is created in BFC following the official communication from from General Group Secretary. 

The packages stay opened along the year to allow the CAM to update the information when necessary and out of the closing periods. However, every quarter the packages have to be published and locked during two days, to allow the FSL SU-FA GL Team to analyze and validate the data at consolidated level.

ACTUAL0 12.YYYY – Quarterly procedure for lockings & unlockings  

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Special cases with Non-conso entities

• In Q1, NC companies should be excluded of the publication done by BFC Admin on D1 => NC companies are required to fill ACTUAL0 package only from Q3. 
• In Q4, NC companies should remain locked. Deadline to collect Financials Y-1 data being Q3. 

ACTUAL0 REPORTING SETUP

The table below summarized for each Reporting quarter the scope of mass lockings and unlockings managed by FSL SU FA GL team:

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ACTUAL0 REPORTING SETUP

The process by which data is reported is defined in the Reporting Organizer and RU Organizer. In these modules it can be definedThe process by which data is reported is defined in the Reporting Organizer and RU Organizer. In these modules it can be defined:

•  "Reporting Organizer"  is the module where BFC Admin will create the ACTUAL0 Reporting category for the current Y defining:
  • Start/End dates / Package schedules / Set of controls / Source for opening balance / Deadline for 1st submission (D-1 end of March Y) / Integration mode after publication
• "RU Organizer" is the module where BFC Admin will insert the Reporting companies and generate their ACTUAL0 package
  • List of companies to be inserted can be copied from the Y-1 ACTUAL0 category, removing after manually the packages not to be created (sold liquidated merged companies) and adding the new companies expected to report from Y

• • Non Conso companies: BFC Admin will adapt their package schedules and set of controls (as they have a different reporting content compared to IG IP MEQ companies)
  • Note that package schedules and set of controls to be used are defined in this document "BFC Admin Reporting set up per category and period"

ACTUAL0 SCOPES OF CONSOLIDATION

3 different scopes used for ACTUAL0 consolidations:

• SOLVAY14 SYENSQO - includes IG / IP / MEQ companies only- note that this is the scope also used in IFRS ACTUAL2 consolidation
• SOLFULL SYENFULL -ALL companies(IG IP MEQ NC) considered as 100% as 100% consolidated (as if they were all IG)
• SOLCONSO SYENCONSO - IG companies consolidated at 100% / IP MEQ and NC consolidated as IP at their % of interests

These Scopes initiated at the beginning of the year, should be updated all during the year each time a change is communicated (by Group General Secretary or by GAR in its structure file).

ACTUAL0 CONSOLIDATIONS SETUP

Here below the list of ACTUAL0 consolidations required during the year and their purpose. 

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Consolidations under variant Variant (V) 2 need to be updated on Quarterly basis:

• when the Conversion Rates of the period are made available (WD-1)
• when theSOLVAY14  SYENSQO scope of the period is made available (WD1)

ACTUAL0 SCHEDULING (AUTOMATED) CONOLIDATION RUNS

• Every quarter on D1 and D2 from WD1 till WD4 scheduling of ACTUAL0 for SOLVAY14 and SOLFULL V2  SYENSQO V2 and SYENFULL V2 and their related Reconciliation consos - 4 times a day 8 am / 12 am / 4 pm / 10 pm. every hour

5.1 REPORTING SETUP - Reporting Organizer

In the Reporting Organizer module, ACTUAL0 Category for the period (Reporting ID) is created with its reporting characteristics (Deadline, Folder, Set of Controls, Opening Balances...).

In the RU Organizer is defined the companies to be reported in the category.

6.1 SCOPES OF CONSOLIDATION - SOLFULL

Changes required for Non Consolidated companies before Generation: Opening balance + Set Folders & Controls

5.4 REPORTING SETUP - Pre-loading of F99 at the beginning of the year

As of 2022, F99 "Closing balance" of L4005 (Investments - number of shares) and L4020 (Shareholder’s equity) is pre-loaded with the F00 "opening data".

To ease the reporting process for the CAM and Accounting Platform managing companies hosting significant numbers of investments or mothers, GAR and FSL SU FA teams requested the pre-loading of F99 in headings XCQ261T / XCQ262T / XCQ101T with the values from previous year (=F00 Opening flow from current year) but keeping the possibility to edit/modify the preloaded data. Change requested for all companies whatever their consolidation status.

At the publication of the packs, CAMs should confirm or modify the values pre-loaded in F99.

As a result, a new formula in the category scenario of ACTUAL0 has been introduced: 

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In order to ensure that this automatic pre-filling is working it is recommended to open 1 package per each consolidation method (IG IP MEQ NC) right after the package generation  to check in schedules L4005 and L4020 that the pre-loading is working as expected.

6.1 SCOPES OF CONSOLIDATION - SYENFULL

• SYENFULL definition- ALL companies (IG IP MEQ NC) considered as 100% consolidated (as if they were all IG)

One scope SYENFULL per year to be updated all during the year each time a change is communicated (by Group General Secretary or by GAR in its structure file).

• SOLCONSO definition - IG companies consolidated at 100% / IP MEQ and NC consolidated as IP at their % of interests

One scope SOLCONSO per year to be updated all during the year each time a change (new companies, leaving companies, change in interests %) is communicated (by Group General Secretary or by GAR in its structure file).

• SOLVAY14 SYENCONSO definition - includes IG companies consolidated at 100% / IP / MEQ companies only - note that this is the scope also used in IFRS ACTUAL2 consolidationMEQ and NC consolidated as IP at their % of interests

One scope SOLVAY14 SYENCONSO per month year to be updated every D1 all during the year each time a change (new companies, leaving companies, change in interests %) following the information received during the month  is communicated (by Group General Secretary or by GAR in its structure file).

6.4 SCOPES OF CONSOLIDATION - Transfer from BFC_TOP to BFC_Prod

BFC _Top

7.1 CONSOLIDATIONS SETUP

6.3 SCOPES OF CONSOLIDATION - SYENSQO

• SYENSQO - includes IG / IP / MEQ companies only (Non Conso excluded)- note that this is the scope also used in IFRS ACTUAL2 consolidation

One scope SYENSQO per month to be updated every WD1 (new companies, leaving companies, change in consolidation methods or in interests %) following the information received during the month (by Group General Secretary or by GAR in its structure file).

In the step Scope, the following procedure describes how to update the companies (insertion & deletion) Companies management in BFC - section 6.ScopeManagement

After all the information is validated the scope has to be transferred to the BFC_Prod_SCO platform.

6.4 SCOPES OF CONSOLIDATION - Transfer from BFC_Top_SCO to BFC_Prod_SCO

BFC _Top_SCO

7.1 CONSOLIDATIONS SETUP

There are 4 consolidations required for the ACTUAL0 category:

• SYENFULL V2.
• SYENCONSO V1 
• SYENSQO V2

This table summarizes purpose and usage of each:

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To create a consolidation it can be done from scratch or with reference to the version of the previous year through the Save As option.

7.1.1 CONSOLIDATIONS SETUP - SYENFULL V2

7.1.3 CONSOLIDATIONS SETUP -

7.

2 INTERCOMPANY RECONCILIATION SETUP

Purpose of this reconciliation performed using ACTUAL0 scopes is to compare and check consistency between shares declared by mothers (schedule L4005 from ACTUAL package) versus the ones declared by daughters (schedule L4020 from ACTUAL0 package) using BFC report "CD190_8".

7.2.1 INTERCO SETUP - using consolidation SYENSQO V2 (IG IP MEQ only)