Adidas 2001 Annual Report Download - page 91

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86 Consolidated Accounts
23. Financial Expenses, net
Financial result consists of the following:
Please refer also to Note 12 and 20.
24. Income Taxes
In general, adidas-Salomon AG and its German subsidiaries are subject
to corporate and trade taxes. In 2000 a new corporate tax legislation was
enacted in Germany, which, among other changes, abolished the split
rate imputation credit system.
Under the old corporate tax system a tax rate of 40% plus a surcharge
of 5.5% thereon has been applied for undistributed earnings on the level
of the Company. Upon distribution of domestic earnings, which had been
subject to corporate tax at 40% , 10 percentage points of corporate tax
and the attributable surcharge thereon were refunded to the Company.
Effective January 1, 2001 a uniform corporate tax rate of 25% plus a
surcharge of 5.5% thereon is applied to earnings.
22. Cost by Nature
Expenses are presented by function in the income statement.
Supplementary information on the expenses by nature is detailed below.
Cost of Materials
The total costs of materials are €3,418 million and €3,234 million for
the years ending December 31, 2001 and 2000, respectively.
Personnel Expenses
Personnel expenses are as follows:
Personnel expenses which are directly attributable to the production costs
of goods are included within the cost of sales.
Year ended Dec. 31
(euros in millions) 2001 2000
Wages and salaries 595 533
Social security contributions 74 73
Pension expense 26 24
Personnel expenses 695 630
Year ended Dec. 31
(euros in thousands) 2001 2000
Interest income 11,727 12,612
Interest expense (107,772) (108,517)
Interest expense, net (96,045) (95,905)
Income from investments 334 474
Fair value gains on investments 2,181 3,126
Other – net, primarily net exchange losses (8,348) (1,649)
Financial expenses, net (101,878) (93,954)