Volvo 2012 Annual Report Download - page 121

Specification of deferred tax assets
and tax liabilities Dec 31, 2012 Dec 31, 2011
Deferred tax assets:  
Unused tax-loss carryforwards 5,232 6,907
Other unused tax credits 171 141
Intercompany profitin inventories 1,026 780
Allowance for inventory obsolescence 443 368
Valuation allowance for doubtful
receivables 568 482
Provisions for warranties 2,257 2,067
Provisions for residual value risks 302 288
Provisions for post-employment
benefits21,850 1,188
Provisions for restructuring measures 219 42
Adjustment to fair valueduring corpo-
rate acquisitions 1 0
Market value of derivative instruments 33 28
Land 1,872 2,204
Other deductible temporary differences 4,602 4,320
Deferred tax assets before
deduction for valuation allowance 18,577 18,815
Valuation allowance (191) (263)
Deferred tax assets after deduction
for valuation allowance 18,386 18,552
Netting of deferred tax assets/liabilities (7,220) (5,714)
B/S Deferred tax assets, net 11,166 12,838
Deferred tax liabilities: 
Accelerated depreciation on property,
plant and equipment 3,176 3 , 811
Accelerated depreciation on leasing
assets 2,064 1,959
LIFO valuation of inventories 362 270
Capitalized product and software
development 3,393 3,721
Adjustment to fair value at company
acquisitions 031
Untaxed reserves 92 92
Market value of derivative instruments 0 1
Provisions for post-employment
benefits2686 –
Other taxable temporary differences 2,476 1,464
Deferred tax liabilities 12,248 11,349
Netting of deferred tax assets/liabilities (7,220) (5,714)
B/S Deferred tax liabilities, net 5,028 5,636
Deferred tax assets/liabilities, net16,138 7, 203
1 The deferred tax assets and liabilities above are partially recognized in the
balance sheet on a net basis after taking into account offsetting possibilities.
Deferred tax assets and liabilities have been measured at the tax rates that are
expected to apply during the period when the asset is realized or the liability is
settled, according to the tax rates and tax regulations that have been resolved or
announced at the balance-sheet date.
2 From 2012 provisions for post-employment benefits are accounted gross. For
2011 the gross amounts were 1,773 (deferred tax assets) and 585 (deferred tax
liabilities).
The total deferred tax assets attributable to unused tax-loss carry-
forwards amounted to 5,232 (6,907) of which 1,815 (2,914) pertains to
Sweden, with an indefinite period of utilization, 1,409 (2,128) to Japan
and 1,278 (1,174) to France.
The cumulative amount of undistributed earnings in foreign subsidiaries,
which the Volvo Group currently intends to indefinitely reinvest outside of
Sweden and upon which deferred income taxes have not been provided is
SEK 60 billion (62) at year end. The main part of the undistributed earn-
ings is pertaining to countries where the dividends are not taxable
Refer to Note 4 for information on how the Volvo Group handles equity cur-
rency risk.
Minority interests are interest attributable to non-controlling shareholders.
Minority interests are presented in the equity, separately from the equity of
the owners of the parent. At business combinations minority interests
should be valued either at fair value or at the minority’s proportionate share
of the acquiree’s net assets. Minority interests are assigned the minority
shareholder’s portion of the equity of the subsidiary. Changes in a parent’s
ownership interest in a subsidiary that do not result in a loss of control are
accounted for as equity transactions.
Minority interests in income for the period and in equity consisted mainly
of the minority interests in Shandong Lingong Construction Machinery
Co, Ltd (30%).
ACCOUNTING POLICY
NOTE 11
MINORITY INTERESTS
117