2020 Universal registration document and annual financial report - BNP PARIBAS 161

4 CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 4.1 Profit and loss account for the year ended 31 December 2020 164

4.2 Statement of net income and changes in assets and liabilities recognised directly in equity 165

4.3 Balance sheet at 31 December 2020 166

4.4 Cash flow statement for the year ended 31 December 2020 167

4.5 Statement of changes in shareholders equity between 1 January 2019 and 31 December 2020 168

4.6 Notes to the financial statements prepared in accordance with IFRS as adopted by the European Union 170 Note 1 Summary of significant accounting policies applied by the Group 170

1.a Accounting standards 170

1.a.1 Applicable accounting standards 170

1.a.2 New major accounting standards, published but not yet applicable 171

1.b Consolidation 172

1.b.1 Scope of consolidation 172

1.b.2 Consolidation methods 172

1.b.3 Consolidation rules 173

1.b.4 Business combination and measurement of goodwill 173

1.c Translation of foreign currency transactions 174

1.d Net interest income, commissions and income from other activities 174

1.d.1 Net interest income 174

1.d.2 Commissions and income from other activities 175

1.e Financial assets and liabilities 175

1.e.1 Financial assets at amortised cost 175

1.e.2 Financial assets at fair value through shareholders equity 176

1.e.3 Financing and guarantee commitments 177

1.e.4 Regulated savings and loan contracts 177

1.e.5 Impairment of financial assets measured at amortised cost and debt instruments measured at fair value through shareholders equity 177

1.e.6 Cost of risk 180

1.e.7 Financial instruments at fair value through profit or loss 180