{
  "docId": "019dd923-622c-750b-8b96-6023c2cb0d2d",
  "docSlug": "671b21c936c8",
  "documentTitle": "Groupe Casino (CO)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson C. Block",
  "documentKindSlug": "shareholder-letter",
  "documentKindLabel": "Shareholder letter",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2016-01-13 00:00:00",
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  "notes": "This is a page from a shareholder letter (likely Muddy Waters Research) exposing accounting inconsistencies.",
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  "components": [
    {
      "bbox": null,
      "kind": "callout",
      "text": "Casino's response appears to be an attempt to further mislead investors.",
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        "h": 0.04,
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      "kind": "paragraph",
      "text": "2. How is booking gains on sales of property so that they’re included in EBITDA consistent with Casino’s disclosed accounting policy or IFRS?",
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      },
      "kind": "paragraph",
      "text": "“As a fully-fledged operational activity, real estate development generates results, which have constantly been reflected in the EBITDA according to the Group’s accounting principles, and in compliance with IFRS standards.”",
      "attrs": null,
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        "h": 0.09,
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      },
      "kind": "paragraph",
      "text": "“An item of property, plant and equipment is derecognised on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an asset is determined as the difference between the net sale proceeds, if any, and the carrying amount of the asset. It is recognised in profit or loss (“Other operating income and expense”) when the asset is derecognised”",
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        "h": 0.08,
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      },
      "kind": "paragraph",
      "text": "3. Why did the company’s response imply that it has always included gains on property sales to Mercialys in EBITDA, when in 2013, the vast majority of the gains did not flow into EBITDA (because they were booked as Other Operating Income in accordance with the company’s disclosed policy for de-recognition of assets)?",
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      "kind": "paragraph",
      "text": "Casino’s response states that it “strictly applies” IFRS. If we’re correct that significant property sale gains are included in EBITDA, then we strongly disagree. Unless the company has a rationale we haven’t considered, this practice seems to directly contravene its policy on accounting for asset de-recognition.",
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      "kind": "quote",
      "text": "“An item of property, plant and equipment is derecognised on disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition of an asset is determined as the difference between the net sale proceeds, if any, and the carrying amount of the asset. It is recognised in profit or loss (“Other operating income and expense”) when the asset is derecognised” — Casino's disclosed asset de-recognition policy",
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