Merck 2008 Annual Report Download - page 100
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The vast majority of the loss carryforwards either have no expiry date or can be carried
forward for up to 20 years. The interest carryforward results from the German earnings
stripping rule and has no expiry date. Deferred tax assets on interest carryforwards
were not recognized. The theoretically possible deferred tax asset amounts to € 10.0
million. In 2008, the income tax burden was reduced by € 7.5 million due to the utili-
zation of tax loss carryforwards and tax credits from prior years for which no deferred
tax asset had been recognized in prior periods (2007: € 8.3 million).
The tax loss carryforwards accumulated in Germany for corporation tax amount to
€ 57.6 million (2007: € 54.5 million) and to € 64.0 million (2007: € 71.9 million) for
trade tax. The increase in additional theoretically possible deferred tax assets for non-
German Group companies to € 52.7 million (2007: € 30.2 million) results mainly from
the write-down of deferred tax assets for capitalized tax-loss carryforwards.
Deferred tax assets and liabilities correspond to the following balance sheet items:
€ million
Dec. 31, 2008 Dec. 31, 2007
Assets Liabilities Assets Liabilities
Intangible assets 37.5 758.3 41.4 753.9
Property, plant and equipment 4.5 84.1 6.7 86.8
Current and non-current financial assets 2.3 28.1 1.1 1.9
Inventories 261.1 47.1 198.4 15.8
Current and non-current receivables/
Other assets 28.7 9.1 12.6 1.0
Provisions for pensions and other post-
employment benefits 58.6 10.3 84.1 15.5
Current and non-current other provisions 131.6 7.7 121.1 4.2
Current and non-current liabilities 22.3 9.1 6.2 7.6
Tax loss carryforwards 7.4 – 63.9 –
Tax refund claims/Other 0.3 16.6 27.5 34.5
Netted deferred tax assets and liabilities –74.2 –74.2 –98.8 –98.8
Total deferred taxes 480.1 896.2 464.2 822.4
Deferred tax liabilities of € 23.0 million (2007: € 10.9 million) were set up for tempo-
rary timing differences for interests in subsidiaries. These relate to planned dividend
payments. No deferred tax liabilities were recognized for other temporary differ-
ences since the reversal of these differences is not foreseeable.
Deferred tax assets of € 472.7 million (2007: € 400.3 million) were recognized for
other temporary timing differences for interests in subsidiaries.
72 Income Statement
73 Balance Sheet
74 Segment Reporting
CONSOLIDATED FINANCIAL STATEMENTS OF THE MERCK GROUP
76 Cash Flow Statement
77 Free Cash Flow
77 Statement of Recognized
Income and Expense
78 Statement of Changes
in Net Equity including
Minority Interest
79 Notes
95