Notes: 31
-
172
Ahold Annual Report 2003
Financial Statements
The effects of the application of US GAAP on consolidated shareholders' equity as of December 28, 2003 and
December 29, 2002 are set out in the table below:
December 28,
2003
December 29,
2002
Shareholders' equity in accordance with Dutch GAAP
4,851
2,609
Items increasing (decreasing) shareholders' equity
Goodwill, net of accumulated amortization
1
7,355
7,866
Other intangible assets, net of accumulated amortization
2
619
737
Impairment of:
Goodwill and other intangible assets
3
(3,577)
(3,511)
Other long-lived assets
4
29
5
Assets held for sale
5
(506)
Restructuring provisions
6
24
12
Sale and leaseback of property
7
(230)
(210)
Derivative instruments
8
(243)
(352)
Valuation of ICA Put Option
9
(601)
(541)
Other
11
(15)
(20)
Income tax effects
12
122
195
Investments in joint ventures and equity investees, net of tax
13
1,893
1,878
Minority interest impact on reconciling items
(101)
(127)
Shareholders' equity in accordance with US GAAP
9,620
8,541
1. Recognition and amortization of goodwill
Under Dutch GAAP, through November 2000, goodwill was charged directly to shareholders' equity upon
acquisition. As discussed in Note 2, effective December 1, 2000, the Company changed its accounting policy
under Dutch GAAP to capitalize and amortize goodwill on a straight-line basis over a period not exceeding 20 years.
This change in accounting policy was applied prospectively for all business combinations completed after
December 1, 2000.
Under US GAAP, for business combinations initiated through June 30, 2001, goodwill was capitalized and
amortized on a straight-line basis over a period not exceeding 40 years. In June 2001, the FASB issued SFAS
No. 141, "Business Combinations" ("SFAS No. 141"), which addresses the initial recognition and measurement
of goodwill and other intangible assets acquired in a business combination. Under US GAAP, the Company adopted
SFAS No. 141 for business combinations initiated after June 30, 2001. In June 2001, the FASB issued SFAS
No. 142, "Goodwill and Other Intangible Assets" ("SFAS No. 142"). SFAS No. 142 addresses the accounting for
goodwill and other intangible assets subsequent to a business acquisition. SFAS No. 142 requires that intangible
assets with finite useful lives be amortized over their estimated useful lives and that goodwill and other intangible
assets with indefinite useful lives are not amortized, but rather tested, at least annually, for impairment. For
business combinations consummated after June 30, 2001, the provisions of SFAS No. 142 were applied from
the date of acquisition. Effective December 31, 2001, the provisions of SFAS No. 142 were applied to goodwill
and other intangible assets acquired prior to June 30, 2001.
During 2001, the Company recognized additional goodwill amortization under US GAAP of EUR 155 primarily
related to acquisitions that were completed prior to the change in the Company's Dutch GAAP accounting policy
to capitalize goodwill effective December 1, 2000, which was partially offset by the impact of a difference in the
amortization period for goodwill under Dutch GAAP and US GAAP. During 2003 and 2002, the Company
recognized EUR 166 and EUR 253, respectively, less goodwill amortization under US GAAP since goodwill
is no longer amortized under US GAAP, after the adoption of SFAS No. 142, effective December 31, 2001.
