Year ended December 31, 2022
This is a translation into English of the statutory auditors’ report on the consolidated financial statements of the Company issued in French and it is provided solely for the convenience of English‑speaking users. This statutory auditors’ report includes information required by European regulations and French law, such as information about the appointment of the statutory auditors or the verification of the information concerning the Group presented in the management report. This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France.
L'OREAL
14, rue Royale
75008 Paris
To the Annual General Meeting of L’Oréal,
In compliance with the engagement entrusted to us by your Annual General Meeting we have audited the accompanying financial statements of L’Oréal for the year ended December 31, 2022.
In our opinion, the financial statements give a true and fair view of the assets and liabilities and of the financial position of the Company as at December 31, 2022 and of the results of its operations for the year then ended in accordance with French accounting principles.
The audit opinion expressed above is consistent with our report to the Audit Committee.
We conducted our audit in accordance with professional standards applicable in France. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Statutory Auditors’ Responsibilities for the Audit of the Financial Statements section of our report.
We conducted our audit engagement in compliance with the independence requirements of the French Commercial Code (Code de commerce) and the French Code of Ethics for Statutory Auditors (Code de déontologie de la profession de commissaire aux comptes) for the period January 1, 2022 to the date of our report, and specifically we did not provide any prohibited non audit services referred to in Article 5(1) of Regulation (EU) No. 537/2014.
In accordance with the requirements of Articles L. 823‑9 and R. 823‑7 of the French Commercial Code (Code de commerce) relating to the justification of our assessments, we inform you of the key audit matters relating to risks of material misstatement that, in our professional judgment, were of most significance in our audit of the financial statements of the current period, as well as how we addressed those risks.
These matters were addressed in the context of our audit of the financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on specific items of the financial statements.
See notes Accounting principles 1.6 - Intangible assets and 1.8.1 - Investments, note 11 - Intangible assets, note 14 - Financial fixed assets and note 30 - List of subsidiaries and investments, to the notes to the financial statements
| Risk identified | Our response |
|---|---|
| Risk identified
At December 31, 2022, investments and intangible assets (excluding software and assets in progress) were recorded in the balance sheet for a net book value of €17 billion and €4.3 billion, respectively, i.e. 84% of the balance sheet total. They are recorded at their date of entry at acquisition cost. An impairment loss is recognized if the value in use of a given item falls below its net carrying amount. |
Our response
We examined the methodology employed by Management to estimate the value in use of investments and intangible assets (excluding software and assets in progress). Our audit work mainly focused on examining, on the basis of the information provided to us, that the estimated values determined by Management were based on an appropriate measurement method and in assessing the quality of these estimates by considering the data, assumptions and calculations used. We focused our work primarily on investments and intangible assets with a value in use close to their net book value. |
