Notes to the consolidated financial statements: Note 1, 2
Financial statements
1 THE COMPANY AND ITS OPERATIONS
2 CHANGES IN ACCOUNTING POLICIES
Adoption of International Financial Reporting Standards
New accounting policies not yet effective for 2005
Euros in millions, except per share data, ratios, percentages and where otherwise indicated; U.S. dollar figures are in
U.S. dollar millions.
The principal activities of Koninklijke Ahold N.V. ("Ahold" or the "Company"), a public limited liability company with its
registered seat in Zaandam, the Netherlands, are the operation through subsidiaries and joint ventures of retail trade stores
and foodservice activities in Europe and the U.S. In addition to Ahold's principal activities, some of its subsidiaries finance,
develop and manage store sites and shopping centers primarily to support Ahold's retail operations. Ahold's subsidiaries, joint
ventures and associates are listed in Note 38.
As a result of Ahold's listing on the New York Stock Exchange (the "NYSE"), Ahold's common shares are registered with the
U.S. Securities and Exchange Commission (the "SEC") and accordingly, Ahold files its annual report on Form 20-F, of which
these consolidated financial statements form a part, with the SEC.
Until 2004 Ahold prepared its consolidated financial statements under generally accepted accounting principles in the
Netherlands ("Dutch GAAP"). As required by a European Union ("EU") regulation, from 2005 onwards the consolidated
financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the
EU. All standards issued by the International Accounting Standards Board (the "IASB") effective for 2005 and all interpretations
issued by the International Financial Reporting Interpretations Committee (the "IFRIC") effective for 2005 have been adopted
by the EU.
The SEC allows foreign private issuers that are IFRS first-time adopters to file only one year of comparative information in the
2005 annual report on Form 20-F, instead of the generally required two years. IFRS requires comparative information for one
year in the annual report. Consequently, Ahold's transition date to IFRS was December 29, 2003, which was the start of the
2004 financial year.
As required by IFRS 1 "First-time Adoption of International Financial Reporting Standards", separate reconciliations and
explanatory narratives are included in these consolidated financial statements on group equity as of December 29, 2003
and January 2, 2005 under IFRS and 2004 IFRS consolidated net income, as compared to Ahold's group equity under
Dutch GAAP as of those dates and 2004 Dutch GAAP consolidated net income, as reported in the 2004 consolidated financial
statements. In addition, these consolidated financial statements include reconciliations between Dutch GAAP and IFRS for the
condensed consolidated balance sheet as of January 2, 2005 and the condensed consolidated statement of operations for
2004. Detailed information regarding the transition from Dutch GAAP to IFRS is included in Note 36.
In 2004 the IFRIC issued IFRIC Interpretation 4 "Determining whether an Arrangement contains a Lease" ("IFRIC 4"). IFRIC
4 provides guidance for determining whether certain arrangements that do not take the legal form of a lease but convey a right
to use an asset are, or contain, leases that should be accounted for in accordance with the lease accounting standard. IFRIC 4
is effective for annual periods beginning on or after January 1, 2006. Ahold is currently in the process of evaluating the
impact, if any, of the adoption of IFRIC 4 on its financial results or position.
Ahold has elected to adopt the amendments to IAS 19 "Employee Benefits" issued in December 2004 in advance of their
effective date of January 1, 2006. The impact of these amendments has been to expand the disclosures provided in these
financial statements in relation to Ahold's defined benefit post-employment plans.
In 2005 the IASB issued amended requirements for financial guarantee contracts, in the form of limited amendments
to IAS 39 "Financial Instruments: Recognition and Measurement" and IFRS 4 "Insurance Contracts". The amendments may
require issuers of financial guarantee contracts to include the resulting liabilities in their balance sheets. The amendments are
AHOLD ANNUAL REPORT 2005 91
