Notes 11, 12
-
-
Financial statements - Notes to the consolidated financial statements
Deferred income tax assets and liabilities are offset in the consolidated balance sheets when there is a legally enforceable
right to offset current tax assets against current tax liabilities and when the deferred income taxes are levied by the same fiscal
authority. The deferred tax assets and liabilities are presented as non-current assets and liabilities in the consolidated balance
sheets as follows:
December 31, January 1,
2006 2006
Deferred tax assets 528 672
Deferred tax liabilities 73 57
Net deferred tax assets 455 615
As of December 31, 2006, Ahold had operating loss carryforwards of a total nominal amount of approximately EUR 4,361,
expiring between 2007 and 2026 (January 1, 2006: EUR 4,193). The following table specifies the years in which Ahold's
operating loss carryforwards are scheduled to expire:
2007
2008
2009
2010
2011
2012
2015
2016
2020
After
2020
Total
Operating loss
18
30
45
2,015
38
146
491
1,578
4,361
Operating loss carryforwards related to one jurisdiction may not be used to offset income taxes in other jurisdictions. Of the
operating loss carryforwards EUR 1,769 relates to U.S. state taxes, for which a weighted average tax rate of 7.4 percent applies.
Significant judgment is required in determining whether deferred tax assets are realizable. Ahold determines this on the basis
of expected taxable profits arising from the reversal of recognized deferred tax liabilities and on the basis of budgets, cash flow
forecasts and impairment models. Where utilization is not considered probable, deferred tax assets are not recognized.
Due to the application of international tax treaties between jurisdictions in which Ahold operates, European Union law, the
Dutch participation exemption and other group tax relief provisions, dividends distributed by and the capital gains (losses) on
divestments of subsidiaries, joint ventures and associates, sold from the Netherlands, are generally tax exempt.
Income taxes charged or credited to equity
Income taxes recognized in and recycled from equity in 2006, 2005 and 2004 are as follows:
2006
2005
2004
Aggregate amount of deferred tax recognized in and recycled from equity
Derivatives
(6)
14
12
Foreign exchange results
(8)
29
5
Share issuance costs
29
Total
15
43
17
In 2003, the Company incurred share issuance costs that
were charged directly to equity for accounting purposes.
Recent developments in Dutch case law on this matter have
led to the recognition of a current tax receivable of
EUR 29 million, related to these share issuance costs,
which has been credited to equity.
12 Non-current assets held for sale
and discontinued operations
On November 6, 2006, Ahold announced its intention to
divest U.S. Foodservice, its retail activities in Poland and
Slovakia, the remaining Tops operations in New York and
Pennsylvania and its 49 percent stake in JMR.
On December 4, 2006, Ahold reached an agreement on the
divestment of its retail operations in Poland to Carrefour
through the sale of the shares of Ahold Polska Sp. zo.o.
The transaction is valued at EUR 375 and will consist of
cash consideration and assumed debt. The final purchase
price is subject to customary price adjustments. Closing of
the transaction is expected mid-year 2007 and is subject
to the fulfillment of certain conditions, including
antitrust approval.
As of year-end 2006, Poland and JMR qualified as held for
sale and discontinued operations. The other businesses to
be divested did not qualify as held for sale as of year-end
2006, in the case of U.S. Foodservice because it is more
likely than not that the transaction between Ahold and the
purchaser of U.S. Foodservice must be submitted for
approval to the General Meeting of Shareholders of Ahold.
After year-end 2006, Tops qualified as held for sale and
discontinued operation as the disposal process of Tops
met the criteria that the assets were available for immediate
sale and the sale was highly probable. Ahold did not divest
any businesses in 2006 that were accounted for as
discontinued operations.
82 Ahold Annual Report 2006
