Notes to the Consolidated Balance Sheet, Profit and Loss Account and Cash Flow Statement for 2001 Valuation of assets and liabilities Intangible fixed assets Goodwill, the difference between the price paid for partici pating interests and their valuation according to Fleineken accounting policies, is charged to shareholders' equity where the group exercises at least a significant influence on management decisions. In the case of acquisition of beverage wholesalers, the purchase price is almost entire ly determined by the customer base and this element, being an intangible asset, is not capitalised, so that a large part of the purchase price in fact constitutes goodwill. When the relevant legal requirements are changed, goodwill will be capitalised and amortised over the expect ed economic life of the assets concerned. Other intangible fixed assets are capitalised and amor tised by the straight-line method over three years. If the net realisable value of intangible fixed assets is less than the carrying amount, a diminution in value is applied. Costs of internally developed brands, patents and licences and research and development are expensed. Brands, patents and licences purchased with acquisitions are treated as part of the goodwill paid. Tangible fixed assets Except for land, which is not depreciated, tangible fixed assets are stated at replacement cost less accumulated depreciation. The following average useful lives are used for depreciation purposes: Buildings 30-40 years Plant and equipment 10-30 years Other fixed assets 5-10 years The replacement cost is based on appraisals by internal and external experts, taking into account technical and economic developments and supported by the experience gained in the construction of breweries throughout the world. Projects under construction are included at cost. Financial fixed assets Non-consolidated participating interests where the group has a significant influence are stated at the Heineken share of the net asset value, which is arrived at as far as possible on the basis of the Heineken accounting policies. Other non-consolidated participating interests are stated at cost less any necessary provisions. Loans to non-consolidated companies and other finan cial fixed assets are carried at face value, less provisions for credit risks. Impairment of assets Regularly it is assessed whether there are any indications that intangible and tangible fixed assets may be impaired. If any such indication exist, the net realisable value of the assets concerned is determined. If the net realisable value of an asset is less than its book value, the difference is deducted from the carrying amount as an impairment loss and charged to the profit and loss account. Current assets Stocks bought in from third parties are stated at replace ment cost, arrived at on the basis of prices from current purchase contracts and latest prices as at balance sheet date. Finished products and work in progress are stated at manufactured cost based on replacement cost and taking into account the production stage reached. Stocks of spare parts are depreciated on a straight-line basis taking account of obsolescence. If the recoverable amount or net realisable value of stocks is less than their replacement cost, provisions are made in respect of the difference. Advance payments on stocks are stated at face value. Receivables are carried at face value less a provision for bad debts and less the amount of deposits on returnable packaging. Securities are carried at the lower of historical cost and quoted price, or estimated market value in the case of unlisted securities. Cash is stated at face value. Revaluations Differences in carrying amounts due to revaluations are credited or debited to group equity, less an amount in respect of deferred tax liabilities where applicable. Investment facilities equalisation account The purpose of the investment facilities equalisation account is to apportion amounts received under investment grant schemes in certain countries over the estimated useful lives of the assets concerned. Provisions The provision for deferred tax liabilities is formed in respect of timing differences between the balance sheet for reporting purposes and the recognition of assets and liabilities for tax purposes as well as taxation on profit dis tributions borne by the group. The liabilities are calculated at the standard tax rates on balance sheet date and are stated at face value. Deferred tax assets are netted off HEINEKEN N.V. ANNUAL REPORT2001 54

Jaarverslagen en Personeelsbladen Heineken

Jaarverslagen | 2001 | | pagina 60