Get Adobe Flash player 5Financial statements CONSOLIDATED FINANCIAL STATEMENTS NOTE 6 RENTAL EXPENSE Rental expense amounted to €938 million in 2012 compared with €903 million in 2011. In accordance with the policy described in note 1.E.4, the expense reported on this line only concern operating leases. Finance leases are recognized in the balance sheet as an asset and a liability. The amount of the liability at December 31, 2012 was €58 million (see note 29.A). Rental expense is recognized on a straight-line basis over the lease term, even if payments are not made on that basis. Most leases have been signed for periods exceeding the traditional nine-year term of commercial leases in France, primarily to protect Accor against the absence of commercial property rights in certain countries. A. Rental expense by business Rental expense can be analyzed as follows by business: (in million of euros) HOTELS (943) Upscale and Midscale Hotels (579) Economy (364) Economy Hotels US -OTHER BUSINESSES 5 TOTAL (938)

None of the leases contains any clauses requiring advance payment of rentals in the case of a ratings downgrade or other adverse events affecting Accor, and there are no cross-default clauses or covenants.

The €938 million in rental expense corresponds to 1,116 hotel leases, including 1% with a purchase option. Where applicable, the option price corresponds to either a pre-agreed percentage of the owner’s original investment or the property’s market value when the option is exercised. The options are generally exercisable after 10 or 12 years. Certain contracts allow for the purchase of the property at the appraised value at the end of the lease.

2011* 2011 published
(907) (999)
(564) (564)
(343) (343)
- (92)
4 4
(903) (995)

* In accordance with IFRS 5, rental expense of the US Economy Hotels and Onboard Train Services businesses have been reported in profit or loss from discontinued operations (see note 17).