6.3 Cash and cash equivalents and other marketable securities
Cash and cash equivalents
“Cash and cash equivalents” include bank balances and short-term investments in money market instruments. To be classified in cash and cash equivalents, investments have to respect IAS 7 criteria. These instruments mainly correspond to bank term deposits and risk-free interest-bearing demand deposits. They have initial maturities of three months or less, are readily convertible into known amounts of cash, and are subject to an insignificant risk of changes in value.
Other marketable securities
Instruments that have initial maturities of more than three months and less than one year are reported under “Other marketable securities”. These instruments are highly liquid and are subject to an insignificant risk of changes in value due to interest rate and foreign exchange rate changes. However, they are no longer classified as cash and cash equivalents in line with IAS 7. This line item also includes restricted cash, corresponding to cash and cash equivalents subject to restrictions due to regulations that are specific to a country (such as exchange rate control). Instruments with initial maturities of more than one year may also be reported under this caption if they can be sold or canceled at any time with incurring material penalties.
“Cash and cash equivalents” and “Other marketable securities” are financial assets recognized according to IFRS 9 – Financial Instruments and its amendments.
Both cash and cash equivalents and other marketable securities are taken into account for the calculation of net debt.