Notes to the Consolidated Financial Statements (in EUR millions, except per share data
1 The company and its operations
2 Basis of presentation and accounting principles under Dutch GAAP
Annual Report Form 20-F
Changes in accounting principles
Pensions
The principal activities of Koninklijke Ahold N.V. ("Royal Ahold", "Ahold" or the "Company") with its legal seat in
Zaandam, The Netherlands, are the operation through subsidiaries and joint ventures of retail trade supermarkets in the
United States of America ("U.S."), Europe, Latin America and Asia and food service activities in the U.S. and Europe.
In addition to its principal activities, certain subsidiaries of Ahold are engaged in the financing, development and
management of store sites and shopping centers primarily in support of the Company's retail operations.
The subsidiaries and unconsolidated affiliates of Ahold are listed in Note 32.
The consolidated financial statements of Ahold have been prepared under accounting principles generally accepted in
The Netherlands ("Dutch GAAP") as discussed below. Historical cost is used as the measurement basis, unless otherwise
indicated. Assets and liabilities are stated at face value and income and expenses are accounted for on an accrual basis.
Gains are only recognized when realized. Losses and risks that originated before the end of the financial year are taken
into account if they have become known before preparation of the financial statements. Ahold also reconciles its financial
position and results to accounting principles generally accepted in the U.S. ("US GAAP"). US GAAP varies from Dutch
GAAP in certain significant respects as further described in Note 31.
As discussed in Note 3 and Note 31.b the Company has restated and reclassified its comparative financial position as of
December 30, 2001 and results for fiscal 2001 and 2000 under Dutch GAAP and US GAAP.
Ahold's fiscal year is a 52- or 53-week period ending on the Sunday nearest to December 31. Fiscal 2002, 2001 and
2000 all consisted of 52 weeks and ended on December 29, December 30, and December 31, respectively. The
Company's subsidiaries in Latin America, Poland, Belgium, Czech Republic and Spain are consolidated using a calendar
year-end. There have been no significant intervening events at these subsidiaries between the Company's fiscal year-end
and the calendar year-end that have a material impact on the consolidated financial statements.
The following are the significant accounting policies applied in the preparation of the accompanying consolidated financial
statements prepared under Dutch GAAP, beginning with changes in accounting principles made in the years presented.
Ahold is subject to the reporting requirements of the Securities and Exchange Commission ("SEC") in the United States as
such requirements apply to foreign companies. Ahold files its Annual Report with the SEC on Form 20-F, together with
such other information as required. Shareholders wishing to obtain a copy of the last Form 20-F may do so by contacting
the company or the Bank of New York ADR department.
Beginning fiscal 2002, under Dutch GAAP, the Company adopted, as permitted by the Guidelines for Annual Reporting in
The Netherlands, Statement of Financial Accounting Standards ("SFAS") No. 87 "Employers' Accounting for Pensions"
and SFAS No. 106 "Employers' Accounting for Postretirement Benefits Other than Pensions" and the guidance applicable
under accounting principles generally accepted in the U.S. ("US GAAP"). Prior to fiscal 2002, Ahold only applied SFAS
No. 87 under Dutch GAAP for its U.S.-based subsidiaries. Ahold's listing on the New York Stock Exchange ("NYSE") and
the filing of its annual report on Form 20-F with the Securities and Exchange Commission ("SEC") in the U.S. already
required the Company to apply SFAS No. 87 in its US GAAP reconciliation for all of its pension arrangements. As preferred
under Dutch GAAP, Ahold has adjusted its Dutch GAAP comparative financial position and results for the effect of the
adoption of SFAS No. 87 for fiscal 2001 and 2000. The effect of this change is presented in Note 3. If Ahold would not
have adopted SFAS No. 87 for its non-U.S. companies under Dutch GAAP for fiscal 2002, the net loss for 2002 would
have been approximately EUR 23 higher.
Revaluations
In fiscal 2002, Ahold changed its accounting policy relating to an incidental revaluation of buildings and land in 1988.
The accounting change was given retroactive effect in these consolidated financial statements. Dutch GAAP permits the
94
