Consolidated Annual Accounts 2017

Atresmedia Corporación de Medios de Comunicación, S.A. and Subsidiaries Translation of consolidated financial statements originally issued in Spanish and prepared in accordance with the regulatory financial reporting framework applicable to the Group in Spain (see Notes 2 and 29). In the event of discrepancy, the Spanish-language version prevails. 2017 CONSOLIDATED FINANCIAL STATEMENTS 18 - On 4 March 2016, Atres Advertising, S.L. Unipersonal acquired a 50% ownership interest in the share capital of Aunia Publicidad Interactiva, S.L., for EUR 1.5 thousand. The latter's company object consists of providing online technical advertising platform services and automated digital and/or online technical advertising platforms, based on market supply. Both companies are accounted for using the equity method. - In December 2016 the Parent contributed capital of EUR 331 thousand to its subsidiary Flooxplay, S.L. Unipersonal and EUR 99 thousand to its subsidiary Atresmedia Música, S.L. Unipersonal. These transactions did not result in a change in the percentage of ownership. c) Comparative information The information contained in consolidated financial statements for 2016 is presented solely for comparison with the information relating to the annual period ended 31 December 2017. 3. Accounting policies The principal accounting policies used in preparing the Group's consolidated financial statements, in accordance with EU-IFRSs, were as follows: a) Goodwill Goodwill arising on consolidation represents the excess of the cost of acquisition, plus the non-controlling interests and fair value of any previous investment in the acquiree, over the Group's interest in the fair value of the identifiable assets and liabilities of a subsidiary at the date of acquisition. The assets and liabilities acquired are measured provisionally at the date on which control of the company is obtained, and the resulting value is reviewed within a maximum period of one year from the acquisition date until the fair value of the assets and liabilities has been calculated definitively. Any difference between the acquisition cost and the fair value of the assets and liabilities acquired is recognised provisionally as goodwill. Goodwill acquired on or after 1 January 2004 is measured at acquisition cost and goodwill acquired before then is stated at the carrying amount at 31 December 2003. In both cases, at the end of each reporting period goodwill is reviewed for impairment (i.e. a reduction in its recoverable amount to below its carrying amount) and, if there is any impairment, the goodwill is written down with a charge to “Impairment and gains/(losses) on disposals of non-current assets” in the accompanying consolidated statement of profit or loss. In this connection, the goodwill arising from the business combination is allocated to each of the Group's cash-generating units (CGUs) or groups of CGUs expected to benefit from the synergies of the combination. An impairment loss recognised for goodwill may not be reversed in a subsequent period.