Heineken N.V. annual accounts 1988
32
and on market prices applicable on the
balance sheet date.
Finished products and products in pro
cess are valued at manufacturing cost,
based on replacement cost and taking
into account the stage of processing.
Stocks of spare parts are depreciated
on a straight-line basis in view of the
reduction of the possibility of use.
Provisions on stocks are made up to the
recoverable amount or net realizable
value, respectively, if this is lower than
the replacement value.
Prepayments on stocks are stated at par
value.
Accounts receivable are shown at par
value, after deduction of a provision for
bad debts and less the amount of depo
sits due on account of the obligation to
take back own packing materials.
Securities have been valued at the cost
of acquisition, unless the market price
or the estimated market value of unlisted
securities is lower.
Cash at bank and in hand are stated at
par value.
Revaluations
Differences in valuation resulting from
revaluation are credited or debited to the
Group funds, if applicable, after deduction
of an amount for deferred tax liabilities.
Investment facilities equalization account
on profit distributions which are borne
by the Group.
The provision for pension liabilities is
determined on the basis of present value.
The provision for other personnel sche
mes is calculated on the basis of the
present value of the benefit commitments
on account of retirement, replacement,
retaining pay and disability, taking into
account where applicable the expected
degree of participation.
Debts
Long-term debts and current liabilities
are shown at par value.
The purpose of the investment facilities
equalization account is to apportion the
amounts received in virtue of arrange
ments in a number of countries with
regard to investments over the estimated
life of the assets concerned.
Provisions
The provision for deferred tax liabilities
is calculated on the differences in valua
tion between the balance sheet and the
statement of financial condition for fiscal
purposes, in so far as these differences
will be taken into account in the levying
of taxation. Calculation takes place at
the nominal rates of the taxes on profit
in the various countries and the taxes
