The restated financial position as per December 30, 2001 and results for fiscal 2001 and 2000 under both Dutch GAAP
and US GAAP reflect adjustments to deconsolidate the Joint Ventures and JMR and account for them using the equity
method of accounting, except for Bomprego, which has been consolidated since July 2000, when we acquired the
remaining voting shares of Bomprego, obtaining majority voting control over it and DAIH, which has been consolidated
since July 2002, when we obtained control of DAIH through the acquisition of additional DAIH shares that we did not
already own.
We recorded restructuring accruals under purchase accounting relating to the acquisition of our 50% interests in
Paiz Ahold in December 1999 and in ICA in April 2000 and subsequent changes to such accruals in fiscal 2001 related
to ICA. Since we did not obtain control over Paiz Ahold and ICA when the respective joint venture interests were acquired,
it was not appropriate to record such restructuring accruals under Dutch GAAP and US GAAP. Our restated consolidated
financial position as of fiscal year-end 2001 and results for fiscal 2001 and fiscal 2000 reflect adjustments to eliminate
the restructuring provisions recorded under purchase accounting, to record the related effect on goodwill and goodwill
amortization, and to record our share of the actual costs related to such restructurings during the respective periods. We
recorded our share of restructuring costs (after taxes) in the amount of EUR 5 million and EUR 10 million for fiscal 2001
and fiscal 2000, respectively. As a result of these restatements, shareholders' equity as of fiscal year-end 2001 increased
by EUR 4 million.
Vendor allowances
As a result of the findings of the investigations at USF and Tops, we determined that our income from vendor allowances
for fiscal 2001 and fiscal 2000 was overstated due to the intentional and unintentional misapplication of Dutch GAAP and
US GAAP and the intentional inappropriate accounting for and mischaracterization of cash receipts, which led to the
recognition of vendor allowances before it was appropriate to do so under Dutch GAAP and US GAAP. Furthermore, certain
vendor allowances were misclassified as revenue instead of as a reduction of cost of sales or selling, general and
administrative expenses, as required under Dutch GAAP and US GAAP.
The restated financial position reflects adjustments to correct overstated vendor allowance income, to correct for the timing
of the recognition of vendor allowances, and to reclassify certain vendor allowances from net sales to either cost of sales or
selling, general and administrative expenses.
We determined that net receivables from vendors as of the date of the USF acquisition in fiscal 2000 did not exist at the
time. In addition, we determined that, at the date of acquisition, a liability for deferred revenue related to vendor allowances
that were not yet earned, was not recorded. Furthermore, we determined that a liability should have been recognized at the
date of acquisition for amounts that had been overbilled to vendors for vendor allowances. The total amount of these
adjustments led to an overstatement of net assets acquired by EUR 70 million.
As required by Dutch GAAP, we have restated our financial position to reallocate the amount of consideration paid in the
USF acquisition originally allocated to vendor allowances to goodwill for the overstatement of these assets. Accordingly, our
shareholders' equity as of fiscal year-end 2000 under Dutch GAAP was reduced by EUR 70 million. For a discussion of
the accounting treatment relating to these adjustments under Dutch GAAP and US GAAP, please see Notes 3 and 32 to
our financial statements.
We discovered various other misstatements relating to vendor allowance transactions prior to fiscal 2000 resulting in an
overstatement of opening shareholders' equity as of January 2, 2000 by EUR 30 million.
In addition to the EUR 100 million in adjustments described above, the net impact of adjustments of vendor allowances
previously recorded in fiscal 2001 and fiscal 2000 is: a reduction of net income by EUR 215 million and EUR 103
million, respectively; a reduction of net sales by EUR 80 million and EUR 44 million, respectively; an increase in cost of
sales of EUR 214 million and EUR 104 million, respectively; an increase in selling, general and administrative expenses
by EUR 2 million in fiscal 2001; a tax benefit of EUR 118 million and EUR 56 million, respectively; and an increase in
share in net loss of joint ventures and equity investees of EUR 37 million and EUR 11 million, respectively.
As a result of these adjustments, shareholders' equity as of fiscal year-end 2001 decreased by EUR 418 million.
Acquisition accounting
In connection with the acquisitions of Superdiplo and our interest in ICA in December 2000 and April 2000, respectively,
we did not properly allocate purchase consideration to certain acquired real estate properties at the respective acquisition
dates. Our restated consolidated financial position and results for fiscal 2001 and fiscal 2000 reflect adjustments to
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