Unilever 2003 Annual Report Download - page 134

Unilever Annual Report & Accounts and Form 20-F 2003 131
Additional information for US investors
Unilever Group
Unilever´s consolidated accounts are prepared in accordance with accounting principles which differ in some respects from those applicable in
the United States. The following is a summary of the effect on the Group’s net profit, combined earnings per share and capital and reserves of
the application of United States generally accepted accounting principles (US GAAP).
€ million € million € million
2003 2002 2001
Restated Restated
Net profit as reported in the consolidated profit and loss account 2 762 2 136 1 680
Attributable to: NV 1 976 1 679 764
PLC 786 457 916
US GAAP adjustments:
Currency retranslation written back on disposals –(22) –
Goodwill 864 1 074 (124)
Identifiable intangible assets 304 284 (118)
Restructuring costs (110) 34 (18)
Capitalised software 72 ––
Interest (45) (77) (55)
Derivative financial instruments (8) 201 (119)
Pensions and similar liabilities (219) (30) 126
Gain on partial disposal of a group company –56 –
Taxation effect of above adjustments including differences in deferred tax accounting 187 32 80
Net increase/(decrease) 1 045 1 552 (228)
Net income under US GAAP before cumulative effect of change in accounting principles for
pensions and derivative financial instruments 3 807 3 688 1 452
Cumulative effect of change in accounting principle net of tax charge of €249 million in 2002 and
tax benefit of €3 million in 2001 –522 (6)
Net income under US GAAP 3 807 4 210 1 446
Attributable to: NV 2 832 3 151 498
PLC 975 1 059 948
Combined net income per share under US GAAP before cumulative effect of change in
accounting principles
Euros per €0.51 of ordinary capital 3.90 3.74 1.43
Euro cents per 1.4p of ordinary capital 58.52 55.99 21.38
Combined diluted net income per share under US GAAP before cumulative effect of change in
accounting principles
Euros per €0.51 of ordinary capital 3.79 3.62 1.39
Euro cents per 1.4p of ordinary capital 56.81 54.33 20.81
Cumulative effect of change in accounting principles – combined net income per share
Euros per €0.51 of ordinary capital –0.53 (0.01)
Euro cents per 1.4p of ordinary capital –8.02 (0.09)
Cumulative effect of change in accounting principles – diluted combined net income per share
Euros per €0.51 of ordinary capital –0.52 (0.01)
Euro cents per 1.4p of ordinary capital –7.78 (0.09)
Amounts reported in the financial statements have been restated following changes in our accounting policies for pensions and similar
obligations and for share-based payments. See note 17 on page 99 and note 29 on page 117.
From 1 January 2003, for US GAAP purposes Unilever has adopted SFAS 123 ‘Accounting for Stock-Based Compensation’. The economic fair
value of the awards is calculated using an option pricing model (usually an adjusted Black-Scholes or multinomial model) and the resulting cost
is recognised as remuneration cost amortised over the vesting period of the grant. Variable plans, being those with performance criteria other
than a service period, are also accounted for in accordance with SFAS 123. The actual remuneration cost charged in each period is shown
below. Amounts for prior years have been restated to reflect compensation costs for all the employee awards granted or modified in fiscal years
beginning after 1994.
With effect from 1 January 2002, and for the purposes of determining the expected return on plan assets for US purposes, Unilever changed
the method of valuing its pension plan assets from a market-related value calculated by smoothing gains and losses over a five-year period to
an actual fair value at the balance sheet date. Management believe that the actual fair value methodology provides a better representation of
the financial position and results of Unilever’s pension plans.