Volvo 2005 Annual Report Download - page 138

Parent Company AB Volvo
134 Volvo Group 2005
General information
Am ou nt s in SEK M un le s s othe rwi se spe ci fi ed. Th e amou nt s wit hi n
pa re nt he se s refe r to prec e di ng yea r.
Intra-Group transac tions
O f the Pare nt Com pa n y ’s sal e s , 567 (426) w er e to G r ou p comp a ni e s
an d purch a se s fro m Gro up com pa ni e s amo unt e d to 35 6 (126).
Fe e s to au di t or s
Fe e s and othe r remu ne r at i on s pai d to exte r na l audi t or s for the fi sca l
ye ar 20 0 5 tot a le d 31 (26), of whic h 10 (13) for audi ti ng , dis t r ib u te d
betwe en Pr i ce wa te r h ou se C o op e r s , 10 (13) and other s, 0 (0), and 21
(13) rela te d to n o n- au di t servi c e s fro m Pri c ew at er h ou se C o o pe r s .
Note 1 Accounting principles
Note 2 Administrative expenses
Administrative expenses include depreciation of 1 (1) of which 1 (1) pertain to machinery and equipment and 0 (0) to buildings.
Summarized reconciliation of shareholders’ equity
SEK M 040101 041231 050101
Shareholders’ equity according
to previous Annual report 60,768 53,668 53,668
Revaluation of loans 235 283 283
Share-based payments – 14 14
Investments in listed companies – – (501)
Shareholders’ equity after
change of accounting principle 61,003 53,965 53,464
Summarized reconciliation of net income
SEK M 2004
Income for the period according
to previous Annual report 5,098
Revaluation of loans 66
Deferred tax (18)
Income for the period after change
of accounting principle 5,146
The accounting principles applied by Volvo are described in Note 1
to the cons ol id a te d fi nanc i al sta te me nts .
As of Jan ua ry 1, 200 5 , the Par en t Com pa ny ap pl i e s the Swedi sh
Fi na n ci a l Acc ou nt in g Sta nd a rd s Coun c il ’s RR 32 Ac c ou nt in g for
le ga l ent it i e s , wit h ret ro act i ve re s t at e me nt fro m Jan ua ry 1, 2 0 0 4.
Th e Sta nd a rd me an s that le ga l ent it i e s whos e secu r i ti e s on the clos-
ing dat e are lis te d on a Swe d ish st o ck exch a ng e or othe r auth or i ze d
ma r ket p la c e as main ru le sha ll ap pl y the IF R S/ I A S as app li e d in t h e
co nso li d ate d acc o unt in g . Com pa r is on fi gu re s for 200 4 , in t a b le s and
the note s, hav e bee n res t at e d wher e app li c a bl e . An exce pt io n is
how ev er IA S 39 Fina n ci a l Inst r um en t s whic h is appl ie d as of J a nu ary
1, 200 5 .
Th e Vol vo Gro up has ado pte d IA S 19 Emp lo ye e Ben efi ts in i t s
fi nan ci a l rep orti ng. Th e par en t comp a ny is stil l app l y in g the pri nc i-
ple s of FA R ’s Rec om me nd a ti on No . 4 “Acc o unt in g of pensi o ns lia bi l-
it ie s and pe nsi o n cos t s” as in prev i ou s yea r s . Con se qu e nt l y ther e are
diffe re nc e s betwe en the Volvo Gro up and the Pa re nt Co mp a ny in
the acc o unt in g for defi n ed -b e ne fi t pe nsi o n plan s as well as in v al ua -
tio n of p l an as se t s inve st e d in t he Vol vo Pens io n Foun da ti on .
Th e diff er en c e bet w e en dep re c ia ti o n acco rd in g to p l an and
de pr ec i at io n allo wa b le for tax purp o se s is r ep o rted as acc um ul at ed
add i ti on a l depr e ci at io n , whi ch is inclu d ed in untaxe d res erve s . In the
co nso li d ate d ba la nc e she et a sp li t is made betw e en defe r re d tax lia-
bil i t y an d equi ty ca p ita l .
Rep orti ng of Grou p cont r ibu t io ns is in ac c or d an c e with a s t a te -
men t issu ed by a sp e ci a l comm itte e of th e Swed ish Fi na nc i a l
Ac co un ti ng Sta nd a rd s Cou nc il . Gro up co ntr i bu t io ns are rep o rt e d
am on g Inco m e from inve s t me nt s in Grou p comp a nie s.
For the Par en t Com pa ny the mos t impo rta n t impact of RR 32 ha s
be en in the follo w in g thre e are as :
He dg e acc ou nt in g
He dg e acc ou nt in g in a leg a l enti ty of net i nv e st m en t s in fo re i gn
op er a ti on s is no t per mi tt e d acco rd in g to R R 32. T h e Pare nt Co m-
pa ny has in prev i ou s year s use d a lo a n to h ed g e shar e s in a fore ig n
subs id ia ry in t he cor re s po nd in g cur re nc y. Thi s loa n has bee n
rep o rted at hist or i c a l rate an d not b e e n reva lu at e d . Acco r din g to IA S
21 lo an s in fo re i gn cur re nc i e s shal l be r ep o rted at clos in g rate . Th e
tr an si ti o n ef fe c t on Janu a ry 1, 200 4, is repo rte d in th e shar e ho ld e rs’
equ i t y wh er e as rev a lu at io n as of 2 0 04 is rec og ni ze d in t he inc om e
statement .
Share-based Payments
Th e new shar e- b as e d ince nt i ve pro gr a m adop te d at t he 20 0 4
An nu al Ge ne r a l Meet in g is c ov e re d by I F R S 2 Sh a re -b a se d pay -
ments.
Inv e st m en t s in ot he r com pa ni e s
In acc or da n ce wi th IA S 39, all inve s t me nt s in comp a ni es, exc ep t if
the s e inve st m en t s are cla ss i fi e d as ass oc i ate d com pa n ie s , sho ul d
be rep orte d in t he ba la n ce she et at fair va lu e . The tra ns it i on ef f ect
on Jan ua ry 1, 20 0 5 , at t ri bu t a b le to this acc ou nt ing ch an ge is rela te d
to Vol vo’s inve s tm e nt in D e utz AG
A f u rt he r des cr i pt io n of t he mos t imp ort an t cha ng e s for the P a r-
ent Co mp a ny by t he app l ic a ti on of RR 32 is found be lo w in th e
ta b le s of reco nc i li at io n of sh a re ho l de r s’ equi ty an d net i nc o me .
Notes and comments