8 Financial and accounting information Statutory Auditors’ report on the consolidated financial statements SAINT-GOBAIN UNIVERSAL REGISTRATION DOCUMENT 2021 335 Statutory Auditors’ report on the consolidated 2. financial statements For the year ended December 31, 2021 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 regulation and French law, such as information about the appointment of the statutory auditors or verification of the information concerning the Group presented in the management report and other documents provided to shareholders. This report should be read in conjunction with, and construed in accordance with, French law and professional auditing standards applicable in France. To the Shareholders, Opinion In compliance with the engagement entrusted to us by your Shareholders’ Meeting, we have audited the accompanying consolidated financial statements of Compagnie de Saint-Gobain (“the Group”) for the year ended December 31, 2021. In our opinion, the consolidated financial statements give a true and fair view of the assets and liabilities and of the financial position of the Group as at December 31, 2021 and of the results of its operations for the year then ended in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. The audit opinion expressed above is consistent with our report to the Audit and Risk Committee. Basis for Opinion Audit Framework 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 Consolidated Financial Statements section of our report. Independence We conducted our audit engagement in compliance with independence requirements of the French Commercial Code (code de commerce) and the French Code of Ethics (code de déontologie) for statutory auditors, for the period from January 1, 2021 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. Justification of Assessments - Key Audit Matters Due to the global crisis related to the Covid-19 pandemic, the financial statements of this period have been prepared and audited under specific conditions. Indeed, this crisis and the exceptional measures taken in the context of the state of sanitary emergency have had numerous consequences for companies, particularly on their operations and their financing, and have led to greater uncertainties on their future prospects. Those measures, such as travel restrictions and remote working, have also had an impact on the companies’ internal organization and the performance of the audits. It is in this complex and evolving context that, 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 consolidated 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 consolidated financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on specific items of the consolidated financial statements. Measurement of goodwill, intangible assets and property, plant & equipment Description of risk The carrying amounts of goodwill, intangible assets and property, plant & equipment were significant at December 31, 2021, representing €11,181 million, €2,705 million and €11,663 million, respectively. These assets may be impaired due to internal or external factors, including decisions to change the Group’s strategy in certain markets, a decline in Group performance, the Group’s commitments to carbon neutrality, changes in competition, unfavorable market conditions particularly in the context of the Covid-19 pandemic and changes in legislation or regulations. These changes are likely to have an impact on the Group’s forecast cash flow and, consequently, the assets’ recoverable amounts. The impairment tests performed by Management using the method described in Note 7.5 to the consolidated financial statements led to the recognition of impairment losses of €213 million in the year ended December 31, 2021 (including impairment on assets held for sale), as indicated in Note 5 to the consolidated financial statements.
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