Chrysler 2004 Annual Report Download - page 117

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Consolidated Financial Statements at December 31, 2004 – Notes to the Consolidated Financial Statements
As disclosed in the accounting policies, in recording Deferred tax assets, each company in the Group critically evaluated whether the
conditions existed for the future recoverability of such assets on the basis of updated strategic plans, accompanied by the related tax
plans. For this reason, the total theoretical future tax benefits deriving from positive temporary differences (4,206 million euros at
December 31, 2004 and 4,258 million euros at December 31, 2003) and tax loss carryforwards (4,591 million euros at December 31,
2004 and 4,313 million euros at December 31, 2003) have prudently been reduced for a total of 5,549 million euros at December 31,
2004 and 5,216 million euros at December 31, 2003.
In particular, the Deferred income tax reserve net of Deferred tax assets includes 1,208 million euros (1,259 million euros at December
31, 2003) of tax benefits connected to tax loss carryforwards. However, a further tax benefit connected to tax loss carryforwards of
3,383 million euros (3,054 million euros at December 31, 2003) has not been recorded in the financial statements.
Deferred taxes have not been provided on the undistributed earnings of subsidiaries since no transactions are expected to be
entered into that would warrant their taxation.
Deferred taxes of 59 million euros (72 million euros at December 31, 2003) have not been provided on temporary differences relating
to reserves and provisions in suspension of taxes, since they are not expected to be used in a manner which would warrant their
taxation.
Other reserves
Restructuring reserves amount to 408 million euros at December 31, 2004 (471 million euros at December 31, 2003) and are related
to the corporate restructuring programs of the following Sectors (in millions of euros): Automobile 216 (160 at December 31, 2003),
Agricultural and Construction Equipment 36 (83 at December 31, 2003), Commercial Vehicles 56 (75 at December 31, 2003),
Metallurgical Products 8 (24 at December 31, 2003), Components 59 (64 at December 31, 2003), Production Systems 17 (54 at
December 31, 2003), Services 6 (8 at December 31, 2003), Other Sectors 10 (3 at December 31, 2003).
The Various liabilities and risk reserves amount to 2,276 million euros at December 31, 2004 (2,216 million euros at December 31,
2003) and represent the amounts set aside by individual companies of the Group principally in connection with contractual and
commercial risks and disputes. The increase of 60 million euros compared to December 31, 2003 is the result of a combination of
ordinary provisions of 751 million euros, extraordinary provisions of 259 million euros, decreases for the effect of foreign exchange
differences of 15 million euros, decreases for utilizations of 1,370 million euros and decreases for reversals and other for 435 million
euros.
11 Reserve for employee severance indemnities
Use
At and Other At
(in millions of euros) 12/31/2003 Provisions changes 12/31/2004
Reserve for employee severance indemnities 1,313 187 (214) 1,286
The total reserve for employee severance indemnities amounts to 1,286 million euros at December 31, 2004 (1,313 million euros at
December 31, 2003) and includes the severance indemnities accrued at year-end in favor of the employees of the companies in
accordance with legal requirements.