Volvo 1997 Annual Report Download - page 62

The accounting principles applied by Volvo are described on page 41.
Intra-Group transactions
Of the Parent Company’s sales, 505 (545: 474) were to Group com-
panies, and purchases from Group companies amounted to 183
(136; 74).
Employees
The number of employees at year-end was 181 (468; 452). Wages,
salaries and social costs amounted to 284 (324; 272). Information
on the average number of employees as well as wages, salaries and
other renumerations is shown on page 52.
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1Adm inistrative expenses
Administrative expenses include depreciation of 11 (17; 14), of
which 11 (16; 14) pertained to machinery and equipment, and 0 (1;
0) to buildings.
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2Other operating expenses
Other operating costs include provision for bonus to employees in
the amount of 1 (1; 4).
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3Nonrecurring item s
Income in 1995 was charged with 1,817 pertaining to a write-down
of acquired shares in Volvo Construction Equipment Corporation.
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4Income from investm ents
in Group companies
Of the income reported, 23,563 (738; 1,951) pertained to dividends
from Group companies. Write-downs of shareholdings amounted to
8,244 (53; 217).
Income in 1997 included a supplementary payment of 41 for
shares of Örekron International AB, which was sold in 1988 due to
Örekron having won a tax case pertaining to 1987 taxes.
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5Income from investm ents
in associated com panies
Dividends from associated companies that are reported in the Group
accounts in accordance with the equity method amounted to 37
(28; 109). Shareholdings were written down by 7 (5; 5), and were
divested with a capital gain of 2 (–; –).
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6Income from other shares
and participations
Of the income reported, 16 (158; 218) pertained to dividends from
other companies. Dividends were reduced through write-downs of
shareholdings amounting to 0 (2; 0). Income in 1997 included a loss
of 146 on the sale of Renault SA shares, and a loss of 7 on the parti-
cipation in Blue Chip Jet HB.
Notes to financial statements
AB Volvo
60
Cash flow analyses 1995 1996 1997
Year’s operations
Net income 3,176 898 18,049
Depreciation 14 17 11
Write-down of shareholdings 2,044 60 8,252
Gain on sales of securities — — 102
Changes in untaxed reserves (285) 19 (277)
Decrease (increase) in current
operating assets:
Receivables (2,577) 1,573 (3,332)
Increase (decrease) in current
operating liabilities:
Accounts payable 21 (16) 1
Amounts due to subsidiaries 1,491 8,438 (9,160)
Other current liabilities
and other provisions (133) (1,569) (156)
Net financing from
year’s operations 3,751 9,420 13,490
Investments (increase)
Property, plant and
equipment, net (17) (32) 56
Investments in shares and
participations, net (10,558) (12,551) 4,645
Long-term receivables, net 2,674 158 (623)
Net after investments (4,150) (3,005) 17,568
Financing, dividends, etc
Increase (decrease)in
short-term loans (942) 5,836 (7,067)
Increase (decrease) in
long-term loans and
provisions for pensions 1,324 (2,561) 2,360
Increase in shareholders’ equity
as a result of conversions and
new issue of shares 1,608 — 116
Redemption of shares
in AB Volvo — — (5,807)
Dividend paid to shareholders (1,512) (1,854) (1,993)
Increase (decrease)
in liquid funds (3,672) (1,584) 5,177
Liquid funds, January 1 5,262 1,590 6
Liquid funds, December 31 1,590 6 5,183
Liquid funds include Cash and bank accounts and Short-term investments in
Group companies.