Chrysler 2003 Annual Report Download - page 103

102 Fiat Group Consolidated Financial Statements at December 31, 2003
Notes to the Consolidated Financial Statements
At December 31, 2003, Guarantees granted by the Group total 6,430 million euros (5,642 million euros at December 31, 2002),
detailed as follows:
❚suretyships total 3,060 million euros (1,638 million euros at December 31, 2002. The increase of 1,422 million euros mainly refers
to guarantees that are still being provided to third parties which had previously been granted for the debt of companies in the
Fiat Group that are now controlled by Fidis Retail Italia, which was deconsolidated.
❚Other unsecured guarantees of 3,075 million euros (3,373 million euros at December 31, 2002) include commitments for receivables
and bills discounted with recourse in the amount of 2,203 million euros (2,518 million euros at December 31, 2002). The receivables
and bills discounted with recourse refer to trade receivables and other receivables for 2,144 million euros (2,505 million euros at
December 31, 2002) and financial receivables for 59 million euros (13 million euros at December 31, 2002). The volume of
receivables discounted with recourse in 2003 was 15,341 million euros (20,743 million euros in 2002).
Although not included in the memorandum accounts, receivables and bills discounted by the Group without recourse having due
dates beyond December 31, 2003 amount to 9,852 million euros (in 2002, 13,794 million euros with due dates beyond December 31,
2002). Receivables and bills discounted without recourse refer to trade receivables and other receivables for 4,638 million euros (4,537
million euros at December 31, 2002) and financial receivables for 5,214 million euros (9,257 million euros at December 31, 2002). The
discounting of financial receivables principally refers to securitization transactions involving accounts receivables from the final (retail)
customers of the financial services companies. The accounting treatment for securitization transactions is disclosed in the Accounting
Principles. The volume of receivables and bills discounted without recourse in 2003 was 33,298 million euros (30,502 million euros in
2002).
In summary, the discounted receivables and bills at December 31, 2003 are as follows:
At 12/31/2003 At 12/31/2002
Trade Trade
Receivables Receivables
and Other Financial and Other Financial
(in millions of euros) Receivables Receivables Total Receivables Receivables Total
With recourse 2,144 59 2,203 2,505 13 2,518
Without recourse 4,638 5,214 9,852 4,537 9,257 13,794
The Parent Company and certain of its subsidiaries are involved in various legal actions and disputes. However, the settlement of
such actions and disputes should not give rise to significant losses or liabilities which have not already been set aside in specific risk
reserves.
Commitments
(in millions of euros) At 12/31/2003 At 12/31/2002
Commitments related to derivative financial instruments 20,798 38,535
Commitments to purchase property, plant and equipment 329 494
Other commitments 10,350 9,884
Total Commitments 31,477 48,913
Commitments amount to 31,477 million euros at December 31, 2003 (48,913 million euros at December 31, 2002) and include
derivative financial instruments of 20,798 million euros at December 31, 2003 (38,535 million euros at December 31, 2002).
In particular, the following transactions exist at December 31, 2003:
❚contracts to hedge foreign exchange risks of 4,830 million euros (7,590 million euros at December 31, 2002);
❚contracts to hedge interest rate exposure of 14,142 million euros (27,361 million euros at December 31, 2002);
❚contracts for combined hedging of foreign exchange and interest rate risks of 848 million euros (2,480 million euros at December
31, 2002).
❚equity swaps for 978 million euros (1,104 million at December 31, 2002).
The decrease in the nominal amounts of the above derivative financial contracts compared to December 31, 2002 is largely due
to extraordinary transactions during the period which led to the deconsolidation of outstanding positions and the early closing
of certain loans and the relative hedges.