Unilever 2004 Annual Report Download - page 158

Unilever Annual Report and Accounts 2004 155
Additional information for US investors (continued)
Unilever Group
€ million € million
2004 2003
Capital and reserves as reported in the consolidated balance sheet 5 534 5 920
Attributable to: NV 7 060 6 869
PLC (1 526) (949)
US GAAP adjustments:
Goodwill 4 794 3 252
Identifiable intangible assets 2 515 2 544
Capitalised software 166 72
Restructuring costs 356 83
Interest 275 309
Other comprehensive income effect of derivative financial instruments transition adjustment –(31)
Derivative financial instruments –66
Pensions and similar obligations 1 075 878
Dividends 1 215 1 120
Taxation effect of above adjustments including differences in deferred tax accounting (1 918) (864)
Net increase 8 478 7 429
Capital and reserves under US GAAP 14 012 13 349
Attributable to: NV 13 393 11 960
PLC 619 1 389
The aggregate amounts included in the consolidated Unilever Group capital and reserves (under Unilever accounting principles) in respect of
cumulative currency translation adjustments are as follows:
€ million € million € million
2004 2003 2002
Balance 1 January (6 206) (6 456) (4 954)
Arising during the year 121 250 (1 502)
Balance 31 December (6 085) (6 206) (6 456)
The aggregate amounts of foreign currency transaction gains and (losses) charged in the consolidated
profit and loss account are: (95) (102) (84)
The consolidated accounts of the Unilever Group have been prepared in accordance with accounting principles which differ in certain respects
from those generally accepted in the United States (US GAAP).
The principal differences are set out below.
Profit or loss on disposal of businesses
Unilever calculates profit or loss on sale of businesses after writing back any goodwill previously written off directly to reserves as a movement
in profit retained. Under US GAAP the profit or loss on disposal of the businesses is stated net of the relevant unamortised goodwill included on
the balance sheet and the cumulative currency retranslation differences recognised through the statement of total recognised gains and losses.
Under UK GAAP, gains on the partial disposal of group companies involving non-monetary consideration are recorded in the statement of total
recognised gains and losses. Under US GAAP, these gains are recorded in the profit and loss account.
Goodwill and intangible assets
Under UK GAAP, goodwill (being the difference between the fair value of consideration paid for new interests in group companies, joint
ventures and associated companies and the fair value of the Group’s share of their net assets at the date of acquisition) and identifiable
intangible assets purchased after 1 January 1998 are capitalised and amortised in operating profit over the period of their expected useful life,
up to a maximum of 20 years. Periods in excess of five years are used only where the Directors are satisfied that the life of these assets will
clearly exceed that period. Goodwill and intangible assets purchased prior to 1 January 1998 were written off in the year of acquisition as a
movement in profits retained.
On disposal of a business acquired prior to 1 January 1998, purchased goodwill written off on acquisition is reinstated in arriving at the profit
or loss on disposal.
Under US GAAP prior to 1 January 2002, purchased goodwill and identifiable intangible assets were capitalised and amortised over their useful
lives. From 1 January 2002, under SFAS 142, the amortisation of goodwill and identifiable intangible assets that have indefinite useful lives
ceased. Intangible assets that have finite useful lives continue to be amortised over their useful lives.
Goodwill and identifiable intangible assets that have indefinite lives are assessed annually for impairment.