Chrysler 2005 Annual Report Download - page 233

232 Fiat S.p.A. Financial Statements at December 31, 2005 - N otes to the Financial Statements
03 Fiat S.p.A.
11. Reserves for employee severance indemnities
At December 31, 2005 this reserve totalled 11,996 thousand euros, a net increase of 380 thousand euros from the end of 2004.
A breakdown of the change is as follows:
(in thousands of euros)
Provision for the fiscal year charged to income 4,087
Utilisation for the fiscal year (3,891)
Balance of personnel infragroup transfers and other changes 184
N et change 380
12. D ebt
Borrowings from banks
There were no borrowings from banks at December 31, 2005, for a decrease of 3,060,245 thousand euros with respect to December 31, 2004.
The balance at D ecember 31, 2004 was comprised of 3 billion euros for the Mandatory Convertible Facility granted pursuant to the
Framework Agreement of May 27, 2002 with Capitalia, Banca Intesa, SanPaolo IMI, and Unicredit Banca (the “Lending Banks”) for the purpose
of providing the Fiat Group with the financial support it needed to implement its industrial plan. The facility was disbursed on September 24,
2002 by a pool of banks comprising the Lending Banks and BN L, Monte dei Paschi di Siena,ABN Amro Bank, BN P Paribas, Banco di Sicilia, and
Banca Toscana (the “Banks”). As previously mentioned at N ote 9, the facility was converted on September 20, 2005 through subscription by
the Banks of a rights offering, following the capital increase from 4,918,113,540 euros to 6,377,257,130 euros approved by the Board of
Directors on September 15, 2005. At D ecember 31, 2004, borrowings from banks also included two years of commissions (60,000 thousand
euros) for the subscription commitment that were owed under the agreement to the Banks and paid in 2005.
Advances
Advances totalled 8,656,662 thousand euros and consisted of advances received from Treno Alta Velocità – T.A.V. S.p.A. for the High-Speed
Railway Project, as previously described at N ote 4, Inventories.They refer mainly to work completion and contractual advances.The Florence-
Bologna line accounted for 3,486,925 thousand euros, the Turin-N ovara line for 4,304,045 thousand euros and the N ovara-Milan line for
865,692 thousand euros.W ork completed as of D ecember 31, 2005 amounted to 3,398,254 thousand euros, 4,267,725 thousand euros
and 664,444 thousand euros, respectively.
The 1,320,256 thousand euro increase from D ecember 31, 2004 is due to 283,006 thousand euros in advances received for work completed
on the Florence-Bologna line, 664,780 thousand euros in advances received for work completed on the Turin-N ovara line, and 372,470
thousand euros in advances for work completion on the N ovara-Milan line.
T.A.V. S.p.A. has been provided with bank suretyships to secure these advances and proper execution of work for a total of 1,904,058
thousand euros, as described more exhaustively in N otes 4 and 14.