Deferred tax liabilities and assets are determined based on tem- porary taxable or deductible differences arising between the tax bases of assets and liabilities and their carrying amounts in the Group Consolidated Financial Statements. Current and deferred tax assets and liabilities are offset when income taxes are levied by the same tax authority and when there is a legally enforceable right to offset the amounts.

Deferred tax liabilities and assets are determined using tax rates that have been enacted by the reporting date and are ex- pected to be enforced when the related deferred income tax asset is realised or the deferred tax liability is settled. Deferred tax as- sets and liabilities are not discounted.

Deferred tax assets recognised on tax losses and on de- ductible differences are recognised to the extent that it is prob- able that future taxable profits will be available against which the temporary differences can be utilised.

Tax liabilities include the estimate of risks associated with uncertainties on the tax treatments adopted for determining in- come taxes in accordance with the new IFRIC 23. These uncer- tainties can arise from: i) unclear or complex tax rules; ii) changes in tax regulations or clarifications by tax authorities; iii) ongoing tax audits and/or disputes; iv) public information on ongoing tax assessments and/or disputes involving other entities.

2.17 EARNINGS PER SHARE

The Group presents the basic and diluted earnings per share. The basic earnings per share is calculated by dividing the prof- it or loss attributable to holders of the Company shares by the weighted average of the number of shares for the financial year (defined as equal to the share capital), adjusted to consider any treasury shares held. The diluted earnings per share is calculated by adjusting the profit or loss attributable to shareholders and the weighted average of the number of company shares as defined above, to consider the effects of all potential shares with a dilu- tion effect.

2.18 SEGMENT INFORMATION

For the purposes of IFRS 8 Operating Segments, the Group s busi- ness can be classified to two operating segments, relating to the Moncler and the Stone Island business, aggregated into a sin- gle segment, with similar characteristics to those required by the Standard.

2.19 FAIR VALUE

IFRS 13 is the only point of reference for the fair value measurement and related disclosures when such an as- sessment is required or permitted by other standards. Specifi cally, the principle defi nes fair value as the consi- deration received for the sale of an asset or the amount paid to settle a liability in a regular transaction between market participants at the measurement date. In addition, the new standard replaces and provides for additio- nal disclosures required in relation to fair value measurements by other accounting standards, including IFRS 7.

IFRS 13 establishes a hierarchy that classifies within different levels the inputs used in the valuation techniques necessary to measure fair value. The levels, presented in a hierarchical order, are as follows: level 1: Fair values measured using quoted prices (unad-

justed) in active markets for identical assets or liabilities; level 2: it Fair values measured using inputs other than quot-

ed prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices);

level 3: Fair values measured using inputs for the asset or li- ability that are not based on observable market data (i.e. un- observable inputs).

2.20 PUT & CALL AGREEMENTS WITH MINORITY SHAREHOLDERS

The Group records the fi nancial liabilities relating to put options granted to minority shareholders at the present value of the option exercise price. On the initial recognition of the liability, this value is reclassifi ed from equity by reducing the minority share if the terms and conditions of the put option give the Group access to the econo- mic benefi ts associated with the share of the capital option. The Group accounts for this share as if it had alre- ady been purchased in application of the anticipated interest method. The liability is subsequently restated at each closing date in accordance with the provisions of IFRS 9.

2.21 ACCOUNTING STANDARDS AND RECENTLY PUBLISHED INTERPRETATIONS

ACCOUNTING STANDARDS, AMENDMENTS AND INTERPRETA- TIONS EFFECTIVE FROM 1 JANUARY 2021

Document title Issued date Effective date Approval date EU Regulation and date of publication Interest rate benchmark August 2020 1 January 2021 13 January 2021 (UE) 2021/25 reform - Phase 2 14 January 2021 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16) COVID-19-Related Rent March 2021 1 April 2021 30 August 2021 (UE) 2021/1421 Concessions beyond 31 August 2021 30 June 2021 (Amendment to IFRS 16) Extension of the temporary June 2020 1 January 2021 15 December 2020 (UE) 2020/2097 exemption from applying 16 December 2020 IFRS 9 (Amendments to IFRS 4)

NEW STANDARDS AND INTERPRETATIONS NOT YET EFFECTIVE AND NOT EARLY ADOPTED BY THE GROUP At the date when these annual financial statements were pre- pared, the European Union s competent authorities concluded the approval process needed for the adoption of the accounting standards and amendments described below. With reference of the applicable principles, the Group has decided not to exercise the option of the early adoption, if applicable.

Document title Issued date Effective date Approval date EU Regulation and date of publication Annual Improvements May 2020 1 January 2022 28 June 2021 (UE) 2021/1080 to IFRS Standards 2 July 2021 (2018 2020 Cycle) - [Amendments to IFRS 1, IFRS 9, IFRS 7, IFRS 16 and IAS 41] Property, plant and May 2020 1 January 2022 28 June 2021 (UE) 2021/1080 equipment: proceeds 2 July 2021 before intended use (Amendments to IAS 16) Onerous contracts - May 2020 1 January 2022 28 June 2021 (UE) 2021/1080 Cost of fulfilling a contract 2 July 2021 (Amendments to IAS 37) Reference to the May 2020 1 January 2022 28 June 2021 (UE) 2021/1080 Conceptual Framework 2 July 2021 (Amendments to IFRS 3) IFRS 17 Insurance contracts May 2017 1 January 2023 19 November 2021 (UE) 2021/2036 (incuding amendments June 2020 23 November 2021 published in June 2020)

CONSOLIDATED FINANCIAL STATEMENTS120 121CONSOLIDATED FINANCIAL STATEMENTS MONCLER GROUP

2021