Volvo 2002 Annual Report Download - page 54

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The Volvo Group
Notes to consolidated financial statements
Note 29Leasing
Note 30Personnel
At December 31, 2002, future rental income from noncancellable
financial and operating leases (minimum leasing fees) amounted to
28,327 (31,109; 26,445), of which 25,737 (28,183; 25,664) pertains
to customer-financing companies. Future rental income is distributed
as follows:
Financial leases Operating leases
2003 5.596 4.126
2004–2007 10.483 6.868
2008 or later 376 878
Total 16.455 11.872
Allowance for uncollectible
future rental income (156)
Unearned rental income (689)
Present value of future
rental income 15.610
At December 31, 2002, future rental payments (minimum leasing
fees) related to noncancellable leases amounted to 4,335 (5,192;
4,385).
Future rental payments are distributed as follows:
Financial leases Operating leases
2003 299 1,069
2004–2007 701 1,657
2008 or later 48 561
Total 1,048 3,287
Rental expenses amounted to:
2000 2001 2002
Financial leases:
– Contingent rents (1) (4) (11)
Operating leases:
– Contingent rents (80) (82) (46)
– Rental payments (837) (899) (1,238)
– Sublease payments 1 14 16
Total (917) (971) (1,279)
Book value of assets subject to finance lease:
2001 2002
Acquisition costs:
Buildings 71 110
Land and land improvements 40 32
Machinery and equipment 23 24
Assets under operating lease 2,330 1,499
Total 2,464 1,665
Accumulated depreciation:
Buildings (14) (62)
Land and land improvements (8) –
Machinery and equipment (11) (11)
Assets under operating lease (914) (646)
Total (947) (719)
Book value:
Buildings 57 48
Land and land improvements 32 32
Machinery and equipment 12 13
Assets under operating lease 1,416 853
Total 1,517 946
In accordance with a resolution adopted at the Annual General
Meeting, the fee paid to the Board of Directors is a fixed amount of
SEK 3,250,000, to be distributed as decided by the Board. The
Chairman of the Board, Lars Ramqvist, receives a fee of SEK
1,000,000. Fixed and variable salaries and other benefits for the
Chief Executive Officer and Executive Vice President are prepared
and decided by the Board of Directors. Fixed and variable salaries in
line with the bonus program described below, and other benefits for
other senior executives are prepared and decided by the executive’s
superior, in consultation with his or her superior.
In 2002, Leif Johansson, President and Chief Executive Officer,
received SEK 9,838,891 in fixed salary and other benefits amount-
ing to SEK 500,834. The variable salary for 2002 was SEK
2,542,000, including a 6% upward adjustment, a total of SEK
2,694,520 was allocated to pension. The variable salary corresponds
to 25.8% of the fixed annual salary and is based on operating
income and cash flow. Because the targets for 2001 were not
achieved, Leif Johansson did not receive any employee stock options
in 2002. Leif Johansson is eligible to take retirement with pension at
age 55. Pension benefits earned prior to his employment at Volvo
are coordinated with prior employers and consequently Volvo does
not take the full pension cost for Leif Johansson. The defined pen-
sion benefits are vestad and earned gradually over the years up to
the employee’s retirement age and are fully earned at age 55.
During the period between the ages of 55 and 65, he would receive
a pension equal to 70% of his pensionable salary and in 2002, Volvo
made provisions relating to these pensions amounting to SEK
6,466,500. For the period after reaching the age of 65 he will
receive a pension amounting to 50% of his pensionable salary, in
2002 Volvo made provisions amounting to SEK 5,149,900 relating