Airbus 2015 Annual Report Download - page 221

AIRBUS GROUP FINANCIAL STATEMENTS 2015 l 39 l
Notes to the IFRSConsolidatedFinancialStatements
2.
2.5 Operational Assets andLiabilities
20. Inventories
(In € million) Gross amount Write-down Net book value
2,753
20,435
2,355
3,508
Raw materials and manufacturing supplies 3,229 (476)
Work in progress 25,585 (5,150)
Finished goods and parts for resale 3,134 (779)
Advance payments to suppliers 3,559 (51)
Total 35,507 (6,456) 29,051
31December 2015
(In € million) Gross amount Write-down Net book value
Raw materials and manufacturing supplies 3,219 (502) 2,717
Work in progress 21,667 (4,412) 17,255
Finished goods and parts for resale 2,964 (768) 2,19 6
Advance payments to suppliers 3,233 (46) 3,187
Total 31,083 (5,728) 25,355
31December 2014
The increase in work in progress of €+3,180million is mainly
driven by Airbus and Airbus Defence and Space programmes,
partly offset by Airbus Helicopters programmes. Finished goods
and parts for resale increased at Airbus Defence and Space
and at Airbus Helicopters, partly compensated by a decrease
at Airbus. Advance payments to suppliers increased at Airbus.
Write-downs for inventories are recorded when it becomes
probable that total estimated contract costs will exceed total
contract revenues. In 2015, write-downs of inventories in the
amount of € -410million (2014: € -501million) are recognised
in cost of sales, whereas reversal of write-downs amounts
to € 66million (2014: € 160million). At 31December 2015
€ 9,246million of work in progress and € 1,863million of finished
goods and parts for resale were carried at net realisable value.
21. Trade Receivables and Trade Liabilities
Trade receivables arise when the Group provides goods or
services directly to a customer with no intention of trading
the receivable. Trade receivables include claims arising from
revenue recognition that are not yet settled by the debtor as
well as receivables relating to construction contracts. Trade
receivables are initially recognised at their transaction price
and are subsequently measured at amortised cost less any
allowance for impairment. Gains and losses are recognised in
the Consolidated Income Statement when the receivables are
derecognised or impaired as well as through the amortisation
process.
Allowance for doubtful accounts involves significant
management judgement and review of individual receivables
based on individual customer creditworthiness, current
economic trends including potential impacts from the EU
sovereign debt crisis and analysis of historical bad debts.
Assets and liabilities relative to constructions contracts—
In the construction contract business, an asset or liability is
classified as current when the item is realised or settled within
the Group’s normal operating cycle for such contracts and as
non-current otherwise. As a result, assets and liabilities relating
to the construction contract business such as trade receivables
and payables and receivables from PoC method, that are settled
as part of the normal operating cycle are classified as current
even when they are not expected to be realised within 12months
after the reporting period.
Financial Statements 2015
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Annual Report 2015 Financial Statements 2015
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