Carrying value of intangible assets (continued) Key audit matter How the scope of our audit responded to the key audit matter Intangible assets with a definite useful economic life are carried at cost less accumulated amortisation and accumulated impairment losses. In addition to the amortisation booked on a straight-line basis over the estimated economic useful life of the asset, management assessed impairment indicators on a regular basis. Due to the significance of the carrying value for goodwill and acquisition-related intangible assets and the judgments involved in performing the impairment test, this matter was considered as a key audit matter. We have validated the appropriateness and completeness of the related disclosures in Note 22 to the consolidated financial statements. Based on the procedures performed, we obtained sufficient appropriate audit evidence to corroborate management’s judgments and estimates regarding the carrying value for intangibles assets. Our application of materiality We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the scope of our audit work and in evaluating the results of our work. Based on our professional judgment we determined materiality for the Group as a whole to be CHF 65 million, based on a calculation of 7% of normalised Group income before taxes, adjusted for non-recurring transactions. We selected Group income before taxes as the basis for determining our materiality because, in our view, this measure represents the performance of the Group and is one of the indicators against which Givaudan is commonly assessed and is a generally accepted benchmark. The materiality applied by the component auditors ranged from CHF 20 million to CHF 49 million depending on the scale of the component’s operations, the component’s contribution to Group sales, Group income before taxes, Group total assets and our assessment of risks specific to each location. We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of CHF 3.25 million, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We also reported to the Audit Committee on disclosure matters that we identified when assessing the overall presentation of the financial statements. 102 Givaudan — 2021 Governance, Compensation and Financial Report Governance Report Compensation Report Consolidated Financial Report Statutory Financial Report Appendix