Unilever 2007 Annual Report Download - page 93

Unilever Annual Report and Accounts 2007 91
Financial statements continued
Notes to the consolidated accounts Unilever Group
12 Deferred taxation
€ million € million € million € million € million
Reclassification
As at 1 to liabilities As at 31
January Income held for December
Movements during the year 2007 statement(a) Equity(b) disposal 2007
Pensions and similar obligations 714 (198) (316) – 200
Provisions 692 93 – 1 786
Goodwill and intangible assets (684) (121) 25 – (780)
Accelerated tax depreciation (649) 29 20 2 (598)
Tax losses 113 (32) 3 – 84
Fair value gains (1) (1) (6) – (8)
Fair value losses 4–4–8
Share-based payments 92 (26) 35 – 101
Other (18) 15 – – (3)
263 (241) (235) 3 (210)
(a) Includes €5 million charge reported under discontinued operations in the income statement.
(b) Of the total movement in equity of €235 million, €7 million arises as a result of currency retranslation.
At the balance sheet date, the Group has unused tax losses of €1 471 million and tax credits amounting to €503 million available for offset
against future taxable profits. Deferred tax assets have not been recognised in respect of unused tax losses of €1 146 million and tax credits
of €503 million, as it is not probable that there will be future taxable profits within the entities against which the losses can be utilised. The
majority of these tax losses and credits arise in tax jurisdictions where they do not expire with the exception of €456 million of state and
federal tax losses in the US which expire between now and 2027.
Other deductible temporary differences of €123 million have not been recognised as a deferred tax asset. There is no expiry date for these
differences.
At the balance sheet date, the aggregate amount of temporary differences associated with undistributed earnings of subsidiaries for which
deferred tax liabilities have not been recognised was €1 059 million (2006: €755 million). No liability has been recognised in respect of these
differences because the Group is in a position to control the timing of the reversal of the temporary differences, and it is probable that such
differences will not reverse in the foreseeable future.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax
liabilities and when the deferred income taxes relate to the same fiscal authority. The following amounts, determined after appropriate
offsetting, are shown in the consolidated balance sheet:
€ million € million € million € million € million € million
Assets Assets Liabilities Liabilities Total Total
Deferred tax assets and liabilities 2007 2006 2007 2006 2007 2006
Pensions and similar obligations 514 925 (314) (211) 200 714
Provisions 750 670 36 22 786 692
Goodwill and intangible assets (223) (194) (557) (490) (780) (684)
Accelerated tax depreciation (234) (328) (364) (321) (598) (649)
Tax losses 85 112 (1) 184 113
Fair value gains (3) (1) (5) –(8) (1)
Fair value losses 84––84
Share-based payments 101 92 ––101 92
Other 5(14) (8) (4) (3) (18)
1 003 1 266 (1 213) (1 003) (210) 263
Of which deferred tax to be recovered/(settled) after
more than 12 months 484 460 (1 111) (621) (627) (161)
13 Inventories
€ million € million
Inventories 2007 2006
Raw materials and consumables 1 406 1 360
Finished goods and goods for resale 2 488 2 436
3 894 3 796
Inventories with a value of €101 million (2006: €96 million) are carried at net realisable value, this being lower than cost. During 2007,
€177 million (2006: €160 million) was charged to the income statement for damaged, obsolete and lost inventories. In 2007, €25 million
(2006: €34 million) was utilised or released to the income statement from inventory provisions taken in earlier years.
In 2007, inventories with a carrying amount of €4 million were pledged as security for certain of the Group’s borrowings (2006: €6 million).