Chrysler 2010 Annual Report Download - page 216

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Effects of the Demerger related to Treasury shares held by Fiat S.p.A.
As a result of the Demerger, on 1 January 2011 Fiat S.p.A. was allotted 38,568,458 ordinary shares in Fiat Industrial S.p.A., corresponding to the number
of Treasury shares held. The portion of the Treasury shares equity account attributable to the Fiat Industrial S.p.A. shares and amounting to approximately
€368 million will therefore be reclassified as an asset, measured at its initial fair value. Any effects of initial measurement will be reflected directly in equity
with no impact on 2011 profit or loss.
As described below in the section “Amendments to the stock option plans and stock grant plans of Fiat S.p.A. arising from the Demerger”, 23,021,250
of these Fiat Industrial S.p.A. shares are intended to service the vested stock option plans and the stock grant plans.
Capital reserves
At 31 December 2010, capital reserves amounting to €601 million consist of the additional paid-in capital reserve representing part of the share premium
paid by the subscribers of the capital increase made after the extinguishment of the Mandatory Convertible Facility on 20 September 2005; the remaining
share premium of €859 million arising from this is included in retained earnings. This item also comprises a charge of €81 million arising from the purchase
and sale (without the loss of control) of non-controlling interests in subsidiaries, recognised in equity from 1 January 2010 in accordance with IAS 27.
Effects of the Demerger on the capital reserves of Fiat S.p.A.
As a consequence of the Demerger, the additional paid-in capital reserve of Fiat S.p.A. will be reduced by €462 million to €220 million.
Revenue reserves
The main revenue reserves are as follows:
the legal reserve of Fiat S.p.A. of €716 million at 31 December 2010 (€700 million at 31 December 2009);
retained earnings of €2,796 million at 31 December 2010 (retained earnings of €3,847 million at 31 December 2009);
the income attributable to owners of the parent of €520 million at 31 December 2010 (loss of €838 million for the year ended 31 December 2009);
the share-based payments reserve of €113 million at 31 December 2010 (€95 million at 31 December 2009).
Effects of the Demerger on the revenue reserves of Fiat S.p.A.
As a consequence of the Demerger the legal reserve of Fiat S.p.A. will be reduced by €215 million to €501 million and the retained earnings of Fiat S.p.A.
will be reduced by €1,160 million.