Chrysler 2003 Annual Report Download - page 165

164 Fiat S.p.A. Financial Statements at December 31, 2003
Notes to the Financial Statements
10 Reserves for risks and charges
Reserve for pensions and similar obligations
This reserve covers early retirement incentives and payments and bonuses due to retired employees. Determined on the basis of
actuarial computations, it was established as a result of supplemental collective and individual agreements.
At December 31, 2003, it totaled 23,964 thousand euros, for a net decrease of 13,979 thousand euros compared with the end of 2002,
broken down as follows:
(in thousands of euros)
Provisions for the fiscal year charged to income 5,461
Cash conversion of reserve for early retirement incentives (3,763)
Personnel transfers within the Group (3,298)
Utilization for the fiscal year (12,379)
Net change (13.979)
Other reserves
This item consists of contractually envisaged commissions owed for future listing of Ferrari S.p.A. shares (23,256 thousand euros) on
the stock market, expenses for employee bonuses (7,103 thousand euros), losses of equity investments in excess of their book value
(148 thousand euros), scholarships (68 thousand euros), and costs connected to personnel laid off with long-term unemployment
benefits (443 thousand euros). It totaled 31,018 thousand euros at December 31, 2003, or 2,975 thousand euros more than at
December 31, 2002.
The change resulted from the following:
(in thousands of euros)
Provision for the fiscal year charged to income 8,026
Utilization for the fiscal year, mainly for bonuses granted to employees (5,051)
Net change 2,975
Fiat S.p.A. is still subject to a pending lawsuit for damages resulting from alleged violation of an agreement granting the pre-emption
right on the sale of land located at Via Rivalta 15 in Turin.
Given the pending nature of this action, as well as its specific conditions, no reasonable prediction can be made as to its outcome
or the costs that the company might sustain.
The Company settled the tax litigation regarding its IRPEG (corporate income taxes) liability for 1992 by utilizing the tax relief
envisaged in Article 16 of Law no. 289 of December 27, 2002.
11 Reserves for employee severance indemnities
At December 31, 2003, this reserve totaled 14,112 thousand euros, a net decrease of 10,363 thousand euros from the end of 2002.
A breakdown of the change is as follows:
(in thousands of euros)
Provision for the fiscal year charged to income 30,443
Utilization for the fiscal year (40,806)
Net change (10,363)
12 Payables
Borrowings from banks
This item amounted to 3,030,000 thousand euros at December 31, 2003 with an increase of 30,000 thousand euros comparable to the
figure at December 31, 2002.