Chrysler 2005 Annual Report Download - page 111

110 Fiat Group Consolidated Financial Statements at D ecember 31, 2005 - N otes to the Consolidated Financial Statements
02 Fiat Group
18. Inventories
(in millions of euros) At D ecember 31, 2005 At D ecember 31, 2004
Raw materials, supplies and finished goods 7,499 6,962
W ork in progress 2,550 2,618
Advances on contract work (2,168) (2,323)
Total Inventories 7,881 7,257
At December 31, 2005, inventories include assets sold with a buy-back commitment by Fiat Auto for 748 million euros (771 million euros
at D ecember 31, 2004). N et of this amount, inventories show an increase of 647 million euros in 2005, due to the foreign exchange rate effect
following the appreciation of the U.S. dollar against the euro, and the change in scope of consolidation (approximately 480 million euros).
At December 31, 2005, Inventories include inventories measured at their net realisable value (estimated selling price less the estimated costs
of completion and the estimated costs necessary to make the sale) amounting to 1,614 million euros (1,547 million euros at D ecember 31, 2004).
The amount of inventory write-downs recognised as an expense during the year are 251 million euros (244 million euros in 2004).Amounts
recognised as income from the reversal of write-downs on items sold during the year were not significant.
At December 31, 2005, the carrying amount of inventories pledged as security for loans to the Group is 463 million euros (495 million euros
at December 31, 2004).
The majority of W ork in progress and Advances on contract work relates to the Production Systems Sector (Comau) and can be analysed as
follows:
(in millions of euros) At D ecember 31, 2005 At D ecember 31, 2004
Gross amount due from customers for contract work as an asset 469 407
Less:Gross amount due to customers for contract work as a liability (87) (112)
Work in progress, net of advances on contract work 382 295
Aggregate amount of costs incurred and recognised profits (less recognised losses) to date 2,550 2,618
Less:Progress billings (2,168) (2,323)
Work in progress, net of advances on contract work 382 295
At December 31, 2005, retentions by customers on progress billings amount to 9 million euros (1 million euros at D ecember 31, 2004).