Volvo 2013 Annual Report Download - page 176

Amounts in SEK M unless otherwise specifi ed. The amounts within
parentheses refer to the preceding year, 2012.
The Parent Company has prepared its fi nancial statements in accordance
with the Swedish Annual Accounts Act (1995:1554) and RFR 2, Account-
ing for Legal entities. According to RFR 2, the Parent Company shall apply
all the International Financial Reporting Standards endorsed by the EU as
far as this is possible within the framework of the Swedish Annual
Accounts Act. The changes in RFR 2 applicable to the fi scal year begin-
ning January 1, 2013, have had no material impact on the fi nancial state-
ments of the Parent Company.
The accounting principles applied by the Volvo Group are described in
note 1 Accounting principles to the consolidated fi nancial statements.
The main deviations between the accounting principles applied by the
Volvo Group and the Parent Company are described below.
Shares and participations in Group companies and investments in joint
ventures and associated companies are recognized at cost in the Parent
Company and test for impairment is performed annually. Dividends is rec-
ognized in the income statement.
The Parent Company applies the exception in the application of IAS 39
which concerns accounting and measurement of fi nancial contracts of
guarantee in favour of subsidiaries and associated companies. The Parent
Company recognizes the fi nancial contracts of guarantee as contingent
liabilities.
The Volvo Group applies IAS 19 Employee Benefi ts in the consolidated
fi nancial statements. The Parent Company is applying the principles of
FAR’s Recommendation RedR4 “Accounting of pension liabilities and
pension costs”. Consequently there are differences between the Volvo
Group and the Parent Company in the accounting of defi ned benefi t pen-
sion plans as well as in the measurement of plan assets invested in the
Volvo Pension Foundation.
The Parent Company recognizes the difference between depreciation
according to plan and tax depreciation as accumulated additional depre-
ciation, included in untaxed reserves.
Reporting of Group contributions is recognized in accordance with the
alternative rule in RFR 2. Group contributions are reported as Allocations.
As from January 1, 2013, the holding in the listed company Eicher
Motors Ltd is recognized at fair value. The holding is classifi ed as “Finan-
cial assets available for sale” and changes in fair value are recognized in
Other comprehensive income. Comparative fi gures for 2012 have been
restated.
Change in accounting principle have had the following impact on the
fi nancial statements of the Parent Company:
Other shares and participations Jan 1, 2012 Dec 31, 2012
Carrying value according to previous Annual Report 552 248
Change in value of fi nancial assets available for sale 196 543
Carrying value after change of accounting principle 748 791
Shareholders’s equity Jan 1, 2012 Dec 31, 2012
Carrying value according to previous Annual Report 42,159 41,237
Change in value of fi nancial assets available for sale 196 543
Carrying value after change of accounting principle 42,355 41,780
Other comprehensive income Dec 31, 2012
Carrying value according to previous Annual Report  5,067
Items that may be reclassifi ed subsequently to
income statement: 
Change in value of fi nancial assets available for sales  347
Carrying value after change of accounting principle  5,414
Other operating income and expenses include costs for legal processes,
donations and grants.
OTHER OPERATING INCOME
AND EXPENSES
NOTE 4
INCOME FROM INVESTMENTS
IN GROUP COMPANIES
NOTE 5
Dividends from Group companies amounted to 1,689 (920). Of dividends,
1,080 (–) pertain to dividend from Volvo Financial Services AB, 312 (55)
from Volvo China Investment Co Ltd, 105 (–) from Volvo East Asia (Pte)
Ltd, 85 (–) from Volvo Group UK Ltd, 59 (–) from Volvo Malaysia Sdn Bhd,
37 (258) from Volvo Construction Equipment NV, 11 (–) from Volvo UK
Holding Ltd and – (572) from Volvo Aero AB.
Shares in subsidiaries were written down by 996 (110). 843 (–) pertain
to shares in Volvo Group Japan Co, 63 (110) pertain to shares in Volvo
Italia Spa, 50 (–) pertain to shares in Volvo Parts AB and 40 (–) pertains
to shares in Volvo Business Services AB.
Income 2012 included 2,865 referring to the gain on sale of shares in
Volvo Aero AB. An adjustment of the gain has been made by an expense of
106 during 2013.
Transfer price adjustments and royalties amount to an expense of 1,128
(524).
172
FINANCIAL INFORMATION 2013
NOTES TO FINANCIAL STATEMENTS
NOTE 1 ACCOUNTING PRINCIPLES The Parent Company’s net sales amounted to 659 (670), of which 514
(559) pertained to Group companies. Purchases from Group companies
amounted to 351 (353).
NOTE 2 INTRA-GROUP TRANSACTIONS
Depreciation
Administrative expenses include depreciation of 16 (16) of which 1 (1)
pertains to machinery and equipment, 1 (1) to buildings and 14 (14) to
other intangible assets.
Fees to the auditors 2013 2012
PricewaterhouseCoopers AB
– Audit fees 18 23
– Audit-related fees 2 2
– Tax advisory services 1 3
– Other fees 5 23
Total 26 51
See Note 28 to the consolidated fi nancial statements for a description of the
different categories of fees to the auditors.
Personnel
Wages, salaries and other remunerations amounted to 289 (295), social
costs to 87 (90) and pension costs to 100 (90). Pension cost of 6 (6)
pertained to Board members and the President. The Parent Company has
outstanding pension obligations of 1 (0) to these individuals.
The number of employees at year-end was 279 (258).
Read more about the average number of employees, wages, salaries and other
remunerations including incentive program as well as Board members and
senior executives by gender in Note 27 to the consolidated fi nacial statements.
NOTE 3 ADMINISTRATIVE EXPENSES