BMW 2011 Annual Report Download - page 104

104
76 GROUP FINANCIAL STATEMENTS
76 Income Statements
76 Statement of
Comprehensive Income
78 Balance Sheets
80 Cash Flow Statements
82 Group Statement of Changes
in Equity
84 Notes
84 Accounting Principles
and Policies
100 Notes to the Income
Statement
107 Notes to the Statement
of Comprehensive Income
108
Notes to the Balance Sheet
129 Other Disclosures
145 Segment Information
Changes in deferred taxes include changes relating to
items recognised either through the income statement
or directly in equity as well as the impact of exchange
rate and first-time consolidations. Net deferred liabili-
ties decreased by € 429 million (2010: € 269 million) as a
result of items recognised directly in equity, including
€ 274 million (2010: € 210 million) due to the fair value
measurement of derivative financial instruments and
marketable securities, shown in the summary above in
the line items “Other current assets” and “L
iabilities”.
Changes in actuarial gains and losses arising on de-
fined pension obligations, similar obligations and plan
assets and recognised directly in equity accounted for a
further € 155 million (2010: € 59 million) of the decrease
in net deferred liabilities. These amounts are shown in
the summary above in the line item “Provisions”.
Deferred taxes are not recognised on retained profits of
€ 20.7 billion (2010: € 16.2 billion) of foreign subsidiaries,
as it is intended to invest these profits to maintain and
expand the business volume of the relevant companies.
A computation was not made of the potential impact
of income taxes on the grounds of disproportionate ex-
pense.
The tax returns of BMW Group entities are checked reg-
ularly by German and foreign tax authorities. Taking
account of a variety of factors – including existing inter-
pretations, commentaries and legal decisions taken re-
lating to the various tax jurisdictions and the BMW
Group’s past experience – adequate provision has, as far
as identifiable, been made for potential future tax obli-
gations.
deferred tax asset. For entities with tax losses available
for carryforward, a net surplus of deferred tax assets
over deferred tax liabilities is reported at 31 December
2011 amounting to € 568 million (2010: € 587 million).
Deferred tax assets are recognised on the basis of man-
agement’s assessment of whether it is probable that the
relevant entities will generate sufficient future taxable
profits, against which deductible temporary differences
can be offset.
Capital losses available for carryforward in the United
Kingdom which do not relate to ongoing operations
increased during the financial year 2011 to €2.0 billion
(2010: € 1.9 billion) due to exchange rate factors. As in
previous years, deferred tax assets recognised on these
tax losses – amounting to € 492 million at the end of
the reporting period (2010: € 516 million) – were fully
written down since they can only be utilised against
future capital gains.
“Netting” relates to the offset of deferred tax assets and
liabilities within individual separate entities or tax groups
to the extent that they relate to the same tax authorities.
Deferred taxes recognised directly in equity amounted
to € 1,202 million (2010: € 756 million), an increase of
€ 446 million (2010: € 263 million). The change in 2011
includes the effect of translation differences amounting
to € 17 million (2010: reduction of € 6 million).
Changes in deferred tax assets and liabilities during the
reporting period can be summarised as follows:
in € million 2011 20101
Deferred taxes at 1 January 2,007 1,962
Deferred tax income/expense recognised through income statement – 392 180
Change in deferred taxes recognised directly in equity – 429 – 269
Change in deferred taxes due to purchase of the ICL Group 87 –
Exchange rate impact and other changes2 74 134
Deferred taxes at 31 December 1,347 2,007
1 Adjusted for effect of change in accounting policy for leased products as described in note 8
2 Including impact of first-time consolidations