Nokia 2010 Annual Report Download - page 220

6. Expenses by nature
2010 2009 2008
EURm EURm EURm
Cost of material .............................................. 20 917 19 502 23 892
Personnel expenses ........................................... 6 995 6 747 6 914
Depreciation and amortization .................................. 1 771 1 784 1 617
Advertising and promotional expenses............................ 1 291 1 335 1 600
Warranty costs ............................................... 894 696 1 020
Other costs and expenses ...................................... 8 616 8 643 9 926
Total of Cost of sales, Research and development, Selling and marketing
and Administrative and general expenses ....................... 40 484 38 707 44 969
7. Other income and expenses
Other income totaled EUR 476 million in 2010 (EUR 338 million in 2009 and EUR 420 million in 2008).
Other expenses totaled EUR 368 million in 2010 (EUR 510 million in 2009 and EUR 1 195 million in 2008).
In 2010, other income includes a refund of customs duties of EUR 61 million, a gain on sale of assets
and a business of EUR 29 million and a gain on sale of the wireless modem business of
EUR 147 million impacting Devices & Services operating profit. The wireless modem business was
responsible for development of Nokia’s wireless modem technologies for LTE, HSPA and GSM
standards. The wireless modem business included Nokia’s wireless modem technologies for LTE, HSPA
and GSM standards, certain related patents and approximately 1 100 Nokia R&D professionals, the vast
majority of whom are located in Finland, India, the UK and Denmark. The sale was closed on
November 30, 2010. Other expenses included restructuring charges of EUR 112 million, of which
EUR 85 million is related to Devices & Services and EUR 27 million to Nokia Siemens Networks. The
restructuring charges in Devices & Services mainly related to changes in Symbian Smartphones and
Services organizations as well as certain corporate functions.
Other income for 2009 includes a gain on sale of security appliance business of EUR 68 million
impacting Devices & Services operating profit and a gain on sale of real estate in Oulu, Finland, of
EUR 22 million impacting Nokia Siemens Networks operating loss. In 2009, other expenses includes
EUR 178 million charges related to restructuring activities in Devices & Services due to measures taken
to adjust the business operations and cost base according to market conditions. In conjunction with
the decision to refocus its activities around specified core assets, Devices & Services recorded
impairment charges totalling EUR 56 million for intangible assets arising from the acquisitions of
Enpocket and Intellisync and the asset acquisition of Twango.
In 2008, other expenses include EUR 152 million net loss on transfer of Finnish pension liabilities, of
which a gain of EUR 65 million is included in Nokia Siemens Networks’ operating profit and a loss of
EUR 217 million in Corporate Common expenses. Devices & Services recorded EUR 259 million of
restructuring charges and EUR 81 million of impairment and other charges related to closure of the
Bochum site in Germany. Other expenses also included a charge of EUR 52 million related to other
restructuring activities in Devices & Services and EUR 49 million in charges related to restructuring
and other costs in Nokia Siemens Networks.
In all three years presented “Other income and expenses” include the costs of hedging forecasted
sales and purchases (forward points of cash flow hedges). Starting from 2009, within the same line
are also included the changes in fair value of derivatives hedging identifiable and probable forecasted
cash flows.
F32
Notes to the Consolidated Financial Statements (Continued)