Universal Registration Document 2022

Groupe Profile

Accounting and valuation of provisions for risks and litigation, liabilities relating to tax risks and litigation, and contingent liabilities

(Notes 1.3 “Provisions”, 9 “Income taxes” and 21 “Provisions for liabilities and charges and contingent liabilities” to the consolidated financial statements)

Risk identified

Publicis Groupe SA’s entities operate in more than 100 countries and are therefore subject to many laws and regulations, including tax rules, that are complex and constantly changing.

Furthermore, in the course of their activity, Publicis Groupe SA and its subsidiaries may be sued or jointly cited in legal proceedings brought against them, or against their customers, by third parties, by competitors of their customers, by an administrative or regulatory authority, or by a consumer association.

Management’s evaluation of the associated risks has led Publicis Groupe SA to recognize provisions for risks and litigation in the amount of M€ 261 as at December 31, 2022, and to recognize some uncertain tax liability in the amount of M€ 229.

Given the uncertainty of the outcome of the proceedings initiated, Management’s high level of judgment in estimating risks, and the recorded amounts of provisions and liabilities, we considered the recognition and measurement of provisions for risks and litigation, liabilities relating to tax risks and litigation, and contingent liabilities, to be a key audit matter.
Our response
  • We examined the procedures implemented by Management to identify risks and disputes, including tax risks, to measure their impact and, where appropriate, assess the amount of liabilities to be recorded.
  • We obtained an understanding of the internal risk and litigation reports prepared by the local teams and compiled by the legal and tax departments.
  • We examined the probability of an outflow of resources and the estimated amount of the obligation:
  • by considering the risk analysis carried out by Publicis Groupe SA and by conducting interviews with the Company’s legal and tax departments, for a selection of risks and disputes deemed complex and significant, in the litigation or pre-litigation phase;
  • by inquiring the external advisers of Publicis Groupe SA or by obtaining legal opinions for the risks and disputes deemed most significant.
  • We examined the appropriateness of the risk and litigation information presented in the notes to the consolidated financial statements.

IV. Specific Verifications

We have also performed, in accordance with professional standards applicable in France, the specific verifications required by laws and regulations of the information relating to the Group given in the Executive Board’s report.

We have no matters to report as to its fair presentation and its consistency with the consolidated financial statements.

We attest that the consolidated non-financial statement required by Article L. 225-102-1 of the French Commercial Code (code de commerce) is included in the information relating to the Group given in the management report, it being specified that, in accordance with Article L. 823-10 of said Code, we have verified neither the fair presentation nor the consistency with the consolidated financial statements of the information contained therein. This information should be reported on by an independent third party.