BMW 2003 Annual Report Download - page 127

126
001 BMW Group in figures
004 Report of the Supervisory Board
008 Supervisory Board
011 Board of Management
012 Group Management Report
12 A Review of the Financial Year
29 Outlook
30 Financial Analysis
44 Risk Management
047 BMW Stock
050 Corporate Governance
054 Group Financial Statements
118 BMW AG Principal Subsidiaries
120 BMW Group10-year Comparison
122 BMW Group Locations
124 Glossary, Index
[Mechatronics]
Mechatronics is the generic term for mechanical
systems which are controlled electronically. It will
revolutionise automobile technology in the years
to come.
[Non-current assets]
Intangible assets: expenses for formation and expan-
sion of business operations, concessions, patents,
licences, design patents, trade marks, goodwill, de-
velopment costs, know-how, etc.
Property, plant and equipment: land and buildings,
plant and machinery, other facilities, factory and office
equipment and construction in progress.
Financial assets: investments in subsidiaries, invest-
ments in associated companies, loans (with a matur-
ity of more than five years) to subsidiaries and to
other companies in which shares are held, invest-
ments in other companies, long-term marketable se-
curities, other loans.
Leased products: from operating leases.
[Online ordering]
Online ordering helps to significantly speed up
change management in handling customer orders,
expedites the order processing and enables, at the
time of order, confirmation that the vehicle can be
completed in the required configuration, so that a
definite delivery date can be given. An important
part
of KOVP.
[Preferred stock]
Stock which receives a higher dividend than com-
mon stock, but without voting rights.
[Principal subsidiaries]
Subsidiaries are those enterprises which, either
directly or indirectly, are under the uniform control of
the management of BMW AG or in which BMW AG,
either directly or indirectly
– holds the majority of the voting rights
– has the right to appoint or remove the majority of
the members of the Board of Management or
equivalent governing body, and in which BMW AG
is at the same time (directly or indirectly) a share-
holder
– has control (directly or indirectly) over another
enterprise on the basis of a control agreement or
a provision in the statutes of that enterprise.
[Production network]
The BMW Group production network is made up
of 15 plants and 8 assembly facilities worldwide.
Particular abilities of the network are the common
supply of systems and components as well as a
high standard of productivity and agility.
[Rating]
Standardised evaluation of a company’s credit
standing which is widely accepted on the global
capital markets. Ratings are published by inde-
pendent rating agencies e.g. Standard& Poor’s or
Moody’s based on their analysis of a company.
[Return on sales]
The ratio of the profit from ordinary activities to
Group revenues. For segment reporting purposes,
the computation is based on the profit before finan-
cial result.
[Risk management]
An integral component of all business processes.
Following enactment of the Law on Control and
Transparency within Businesses (KonTraG), all
companies listed on a stock exchange in Germany
are required to set up a risk management system.
The purpose of this system is to identify risks at an
early stage which could have a significant adverse
effect on the assets, liabilities, financial position and
results of operations and which could endanger the
continued existence of the company. This applies
in particular to transactions involving risk, errors in
accounting or financial reporting and violations of
legal requirements. The Board of Management is
required to set up an appropriate system, to docu-
ment
that system and monitor it regularly with the
aid of the internal audit department.
[Sports Activity Vehicle]
The BMW X5 is the first-ever Sports ActivityVehicle –
a combination of a typical BMW Limousine featuring
sporting and comfortable driving features on the
one hand, with far-reaching driving abilities in terrain
on the other. This creates a new market segment.