Nokia 2003 Annual Report Download - page 159

Notes to the Consolidated Financial Statements (Continued)
36. Differences between International Accounting Standards and U.S. Generally Accepted
Accounting Principles (Continued)
2003 2002
EURm EURm
Reconciliation of shareholders’ equity
Total shareholders’ equity reported under IAS ............................ 15,148 14,281
U.S. GAAP adjustments:
Pension expense ................................................. (49) (37)
Additional minimum liability ....................................... —(5)
Development costs ................................................ (99) (421)
Marketable securities and unlisted investments ......................... 49 77
Provision for social security cost on stock options ....................... 14 35
Deferred compensation ............................................ (10) (13)
Share issue premium .............................................. 186 179
Stock compensation ............................................... (176) (166)
Acquisition purchase price ......................................... 34
Amortization of identifiable intangible assets acquired ................... (51) (29)
Amortization of goodwill ........................................... 396 234
Impairment of goodwill ........................................... 255 104
Translation of goodwill ............................................ (293) (240)
Deferred tax effect of U.S. GAAP adjustments ........................... 64 147
Total shareholders’ equity under U.S. GAAP .............................. 15,437 14,150
Earnings per share under U.S. GAAP
Earnings per share amounts are presented below:
2003 2002 2001
EUR EUR EUR
Earnings per share (net income):
Basic ...................................................... 0.86 0.76 0.40
Diluted .................................................... 0.86 0.75 0.40
Pension expense and additional minimum liability
Under IAS, pension assets, defined benefit pension liabilities and expense are actuarially
determined in a similar manner to U.S. GAAP. However, under IAS the prior service cost, transition
adjustments and expense resulting from plan amendments are generally recognized immediately.
Under U.S. GAAP, these expenses are generally recognized over a longer period. Also, under
U.S. GAAP the employer should recognize an additional minimum pension liability charged to
other comprehensive income when the accumulated benefit obligation (ABO) exceeds the fair value
of the plan assets and this amount is not covered by the liability recognized in the balance sheet.
The calculation of the ABO is based on approach two as described in EITF 88-1, Determination of
Vested Benefit Obligation for a Defined Benefit Pension Plan, under which the actuarial present
value is based on the date of separation from service.
The U.S. GAAP pension adjustment reflects the difference between the prepaid pension asset and
related pension expense as determined by applying IAS 19, Employee Benefits, and the pension
asset and pension expense determined by applying FAS 87, Employers’ Accounting for Pensions.
F-50