Notes to the Consolidated Balance Sheet, the Statement of Income and the Cash Flow Statement
for the Financial Year 2000
financing furnished to these companies. These differences are regarded as a revaluation and are
credited or debited directly to Group funds, taking into account possible taxation. Other differences
relating to changes in rates of exchange are incorporated in the statement of income.
Intangible assets
Goodwill, the difference between the acquisition price and the valuation - calculated in accordance
with the Fleineken accounting policies - of newly acquired companies in which at least a significant
influence is exercised on management policy, is charged to shareholders' equity. In the case of the
acquisition of beverage wholesalers, the purchase price is determined almost entirely by the cus
tomer base which, as an intangible fixed asset, is not - in accordance with the Heineken accounting
policies - shown as an asset. Consequently, a significant portion of the purchase price is goodwill.
Costs of other intangible assets, including brands, patents, licenses, software, research and devel
opment, are charged directly to the statement of income.
Accounting policies for the valuation of assets and liabilities
Fixed assets
Tangible fixed assets are valued at replacement cost and, with the exception of land, less accumu
lated depreciation. The following table of average useful life is used to determine depreciation:
Plants 30 -40 years
Machinery and installations 10 - 30 years
Other fixed operating assets 5 -10 years
The replacement cost is based on valuations made by internal and external experts, taking tech
nical and economic developments into account and supported by the experience gained in the
construction of breweries throughout the world. Projects under construction are stated at histori
cal cost.
The non-consolidated companies in which a significant influence is exercised on management poli
cy, are stated at the Heineken share in their net asset value. This net asset value is determined as far
as is possible on the basis of the Heineken accounting policies. The other non-consolidated compa
nies are valued at the cost of acquisition after deduction of the provisions deemed necessary.
Loans to non-consolidated companies and other financial fixed assets are shown at par value, less
a provision for bad debts.
Current assets
Stocks obtained from third parties are valued at replacement cost. This value is based on the prices
of current purchase contracts and on market prices on the balance sheet date.
Finished products and products in process 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 application
possibility. Provisions on stocks are made up to the recoverable amount or net realizable value if
this is lower than the repiacement cost.
Advance payments on stocks are stated at par value. Accounts receivable are shown at par value af
ter deduction of a provision for bad debts and after deduction of the deposit amounts due in con
nection with the obligation to take back own packaging materials.
Securities are valued at historical cost, or at the market price or estimated market value of unlisted
securities where this is lower.
Cash at bank and in hand is stated at par value.
58