1 — Basis of consolidation
Our consolidated financial statements include CGG S.A. and all its subsidiaries.
Subsidiaries are fully consolidated from the date of acquisition, being the date on which we obtain control, and continue to be consolidated until the date when such control ceases. Control is achieved when we are exposed or have rights to variable returns from our involvement with the investee and have the ability to affect those returns through our power over the investee. When we have less than a majority of the voting or similar rights of an investee, we consider all relevant facts and circumstances in assessing whether we have power over the investee, including contractual arrangements with the other holders or potential voting rights.
The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. All intra-group balances, transactions, unrealized gains and losses resulting from intra-group transactions and dividends are eliminated in full.
Losses within a subsidiary are attributed to the non-controlling interest even if that results in a deficit balance. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If we lose control over a subsidiary, we:
| • |
derecognize the assets (including goodwill) and liabilities of the subsidiary, |
| • |
derecognize the carrying amount of any non-controlling interest, |
| • |
derecognize the cumulative translation differences, recorded in equity, |
| • |
recognize the fair value of the consideration received, |
| • |
recognize the fair value of any investment retained, |
| • |
recognize any surplus or deficit in profit or loss, and |
| • |
reclassify the parent’s share of components previously recognized in other comprehensive income to profit or loss or retained earnings, as appropriate. |
We use the equity method for investments classified as joint venture. A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.