OPERATING AND FINANCIAL REVIEW 9 The following information concerning our financial condition and results Share-based payments of operations is derived from our consolidated financial statements Under French GAAP, share-based compensation related to the grant prepared in accordance with IFRS as adopted by the European Union as of equity instruments is not recognized in the income statement. of and for the fiscalyear ended December 31, 2017 and should be read Under IFRS, the cost of the transactions paid with equity instruments in conjunction with our consolidated financial statements prepared in is recognized as an expense in exchange for an increase in the accordance with IFRS as adopted by the European Union as of and for shareholders’ equity. the fiscal years ended December 31, 2017 included in Section 20.1.1, “Company’s Annual Consolidated Financial Statements (IFRS) for the Intangible assets Fiscal Year Ending December 31, 2017” to this Registration Document. Under IFRS, an intangible asset was recognized and amortized in the Our consolidated financial statements were prepared in accordance context of a license agreement. The acquisition of this license has with IFRS as adopted by the European Union for the fiscal years resulted in the issuance of ordinary shares as consideration paid for in question. Deloitte & Associés and Becouze have audited our the license. consolidated financial statements as of and for the fiscal year ended Employee benefits December 31, 2017. The report of our Statutory Auditors for the Under French GAAP, the Company has chosen not to recognize consolidated financial statements included in this Registration liabilities in relation to long-term employee benefits. Under IFRS, a Document is included in Section 20.1.2. liability has to be recognized for employee benefits for the defined The main differences between IFRS as adopted by the European benefit obligation and is measured as the present value of benefits that Union and French GAAP affecting the financial position and results have accrued to employees through services rendered up to that date, of operations of the Company are broken down as follows for the year based on actuarial methods of calculation. ended December 31, 2017: Net (gain) / loss from the sale of Treasury Stocks 2017 Under IFRS, the Net (gain) / loss from the sale of treasury stocks (K€) Statutory net loss under French GAAP (19,045) are not recognized in the income statement, but as part of equity, in Consolidation Adjustments. GenSight Inc. result (loss) (259) Share-based payments (4,800) Unrealized gains on financial assets Intangible assets (18) Under French GAAP, the Company recorded financial assets at cost, Employee benefits (26) being the acquisition price. Potential loss at year end is recognized through income and unrealized gains are not recognized. Under IFRS, Net (gain) / loss from the sale of Treasury Stocks 43 money market funds are measured at fair value, with unrealized gains Unrealized gains on financial assets (7) being recognized through income as the Company has designated Net loss under IFRS (24,112) these financial assets at fair value through profit and loss. 112 – GENSIGHT BIOLOGICS – 2017 Registration Document