2018 Registration document and annual fi nancial report - BNP PARIBAS230

4 CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018

4

Notes to the fi nancial statements

5.q OFFSETTING OF FINANCIAL ASSETS AND LIABILITIES

The following tables present the amounts of fi nancial assets and liabilities before and after offsetting. This information, required by IFRS 7, aims to enable the comparability with the accounting treatment applicable in accordance with generally accepted accounting principles in the United States (US GAAP), which are less restrictive than IAS 32 as regards offsetting.

Amounts set off on the balance sheet have been determined according to IAS 32. Thus, a fi nancial asset and a fi nancial liability are offset and the net amount presented on the balance sheet when, and only when, the Group has a legally enforceable right to set off the recognised amounts and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. Amounts set off derive mainly from repurchase agreements and derivative instruments traded with clearing houses.

The impacts of master netting agreements and similar agreements are relative to outstanding amounts of transactions within an enforceable agreement, which do not meet the offsetting criteria defi ned by IAS 32. This is the case of transactions for which offsetting can only be performed in case of default, insolvency or bankruptcy of one of the contracting parties.

Financial instruments given or received as collateral include guarantee deposits and securities collateral recognised at fair value. These guarantees can only be exercised in case of default, insolvency or bankruptcy of one of the contracting parties.

Regarding master netting agreements, the guarantee deposits received or given in compensation for the positive or negative fair values of fi nancial instruments are recognised in the balance sheet in accrued income or expenses and other assets or liabilities.