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66
The Volvo Group
Notes to consolidated financial statements
Fair value of Volvo’s financial instruments 1
December 31, 2001 December 31, 2002 December 31, 2003
Carrying Fair Carrying Fair Carrying Fair
value value value value value value
Assets
Investments in shares and participations
fair value determinable 225,245 17,661 25,220 15,537 21,217 18,798
fair value not determinable 3586 – 615 – 626 –
Customer-financing receivables 48,784 49,102 46,998 47,508 46,002 46,244
Other loans to external parties and other
interest-bearing receivables 7,334 7,897 4,807 4,735 6,483 6,623
Marketable securities 13,514 13,399 16,707 16,659 19,529 19,518
Total 95,463 88,059 94,347 84,439 93,857 91,183
Liabilities
Long-term bond loans and other loans 44,751 46,731 46,419 48,282 46,674 48,175
Short-term bank loans and other loans 36,817 36,900 26,018 26,083 27,418 27,655
Total 81,568 83,631 72,437 74,365 74,092 75,830
Derivative instruments
Outstanding derivative contracts for hedging
of commercial currency risks (256) (1,200) 144 855 53 1,335
Outstanding commodity contracts – – – 159 – 5
Outstanding derivative contracts for hedging
of financial currency risks and interest rate risks (556) (425) 1,394 1,987 1,961 2,589
Note 35 Net income and shareholders’ equity in accordance with US GAAP
A summary of the Volvo Group’s net income and shareholders’ equity
determined in accordance with US GAAP, is presented in the
accompanying tables.
Application of US GAAP would have the following effect on con-
solidated net income and shareholders’ equity:
Net income 2001 2002 2003
Net income in accordance with Swedish accounting principles (1,467) 1,393 298
Items increasing (decreasing) reported net income
Derivative instruments and hedging activities (A) (298) 1,772 882
Business combinations (B) ((744) 1,094 556
Investments in debt and equity securities (C) (153) (9,616) 4,007
Restructuring costs (D) (579) – –
Post-employment benefits (E) 456 669 (651)
Alecta surplus funds (F) 111 410 2
Software development (G) (212) (212) (211)
Product development (H) (1,962) (1,236) (352)
Entrance fees, aircraft engine programs (I) (324) (219) (20)
Other (J) 31 37 0
Income taxes on above US GAAP adjustments (K) 821 (357) (532)
Net increase (decrease) in net income (2,853) (7,658) 3,681
Net income (loss) in accordance with US GAAP (4,320) (6,265) 3,979
Net income (loss) per share, SEK in
accordance with US GAAP (10.20) (14.90) 9.50
Weighted average number of shares outstanding (in thousands) 422,429 419,445 419,445
1This table only include a comparison between carrying values and fair values
for interest bearing balance sheet items and derivative instruments. For non
interest bearing financial instruments, such as accounts receivable and
trade payables, the carrying values are considered to be equal to the fair
values.
2Pertains mainly to Volvo’s investments in Scania AB, Deutz AG and Henlys
Group Plc. For the purpose of these disclosures, fair values of listed shares
are based upon quoted market prices at the end of the period.
3No single investment represents any significant amount.