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ENAV S.p.A. Financial Statement

Changes in the estimates of accruals to provisions are recognized in profit or loss in
the period in which the change occurs and as an increase in the liability. A decrease
in estimates is recognized by making a counter-entry to the liability up to its carrying
amount, while any excess is recognized in profit or loss in the line item to which the
provisions refer.
Amounts included in provisions for risks and charges are classified as either current
or non-current depending on the estimated date on which the liability will be settled
or extinguished.
Risks where it is only possible that a liability will arise are shown in the appropriate
disclosure section on potential liabilities, and no provision is made for these.

Grants

Revenue grants are recognized on an accrual basis in the year in which the reasonable
assurance arises that the Company is entitled to receive them, regardless of the date
of receipt.
Capital grants are recorded when a formal allocation resolution exists from the
provider, and if, and only if, there is reasonable certainty that the project being
facilitated will effectively be completed and that the contributions will be received,
based on the information available at the close of the financial period. Capital grants
are recognised and differentiated as current and non-current liabilities, according to
the expected reversal timing, and charged to the Income Statement as income on
a straight-line basis, calculated according to the useful life of the underlying asset
to which the grant refers to directly, thus ensuring there is a correlation with the
amortisations relating to the assets.

Charge Stabilization Provision

The Charge Stabilization Provision was created under a resolution adopted by the
parent company’s shareholders on 9 May 2003 by allocating € 72,697 thousand
of the reserve for finalizing and settling tax receivables (Law No. 289/02). This
increased in subsequent years following allocations of part of ENAV’s net income
approved by the shareholders of the parent company, and is used solely for
business purposes.
The Charge Stabilization Provision falls under the scope of IAS 20 - Government
Grants and Disclosure of Government Assistance. The grant is initially recognized as
a liability (classified in Other non-current liabilities). This liability is then released
to income on the determination of the charge as a means of “supplementing” the
reduced revenues earned by ENAV in the same year through a charge stabilization
process. Specifically, this provision is utilised when ENAV decides to reduce charges,
and in this case a portion of the costs incurred are not re-charged to carriers, but
offset by releasing a portion of the grant recognized as a liability to income, thus
offsetting the low prices. The following points further support these comments:

184 ENAV - Annual financial report 2015