Reebok 2007 Annual Report Download - page 170

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166
ANNUAL REPORT 2007 --- adidas Group CONSOLIDATED FINANCIAL STATEMENTS - Notes to the Consolidated Balance Sheet
8 INVENTORIES Inventories by major classifi cation are as follows:
INVENTORIES
€
in milli
o
n
s
D
ec.
3
1, 200
7
Dec. 31, 2006
A
ll
o
w
a
n
ce
Allowance
for
for
Gross obsoles- Net
Gross obsoles- Net
value cence value
value cence value
Finished goods and
merchandise on hand
Goods in transit
Raw materials
Work in progress
I
nventories, net
1,187 75 1,112
1,208 86 1,122
4
68
—
4
68
428 — 428
40 3 37
46 2 44
12
—
1
2
13 — 13
1,707 78 1,629 1,695 88 1,607
Goods in transit mainly relate to shipments from suppliers in the Far East to subsidiaries in
Europe, Asia and the Americas. The allowance for obsolescence mainly relates to inventories on
hand which amounted to € 431 million and € 349 million as at December 31, 2007 and 2006,
respectively. see also Note 2
9 OTHER CURRENT ASSETS Other current assets consist of the following:
OTHER CURRENT ASSETS
€ in millions
Dec.
31
Dec. 31
2
007 2006
Prepaid expenses
Tax receivables other than income tax
Financial Assets
Interest rate derivatives
Currency options
Forward contracts
Security deposits
Other fi nancial assets
Sundry
O
ther current assets,
g
ross
Less: allowance
Other current assets
,
net
2
74 213
68
74
—
—
2
3
6
11
7
3
8 28
50 29
67
56
53
1 41
3
2
—
529 413
Prepaid expenses relate mainly to promotion agreements and service contracts as well as rents.
Information in relation to forward contracts as well as currency options and interest rate
derivatives is also included in these Notes. see Note 23
10 PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the
following:
PROPERTY, PLANT AND EQUIPMENT
€
in million
s
D
ec.
3
1 Dec. 31
200
7
2006
Land and buildings
Technical equipment and machinery
Other equipment, furniture and fi ttings
Less: accumulated depreciation
Construction in progress, net
Property, plant and equipment, ne
t
4
30
484
115
118
629
567
1
,174
1
,16
9
9
514
498
660
671
42
18
702 689
9
Depreciation expenses were € 145 million and € 129 million for the years ending December 31,
2007 and 2006, respectively see also Note 24. Impairment losses which are included within depre-
ciation and amortization (shown in other operating income and expenses see also Note 24) were
€ 3 million and € 11 million for the years ending December 31, 2007 and 2006, respectively.
These are related to assets within other equipment, furniture and fi ttings, mainly in the Group’s
own-retail activities, for which contrary to expectations there will be an insuffi cient fl ow of future
economic benefi ts.
In connection with the planned sale of the GEV Grundstücksgesellschaft Herzogenaurach
mbH & Co. KG see Note 3, assets amounting to € 17 million were transferred in 2006 from other
current assets to property, plant and equipment (Land and buildings).
For details see Statement of Movements of Tangible and Intangible Assets and Financial Assets (Attachment I to these Notes)