BMW 2002 Annual Report Download - page 63

001 BMW Group in figures
004 Report of the Supervisory Board
008 Supervisory Board
011 Board of Management
012 Group Management Report
031 BMW Stock
034 Corporate Governance
042 Group Financial Statements
106 BMW AG Financial Statements
112 BMW Group Annual Comparison
114 BMW Group Locations
116 Glossary
120 Index
62
are translated at the closing rate. Exchange differ-
ences arising from the translation of shareholders
equity are offset directly against accumulated other
equity. Exchange differences arising from the use
of different exchange rates to translate the income
statement are also offset directly against accumulated
other equity.
The single entity financial statements of BMW AG
and of its subsidiaries in Germany and elsewhere
have been prepared using uniform accounting poli-
cies in accordance with IAS 27. Discrepancies in the
accounting policies of associated companies have
not been adjusted where the amounts involved are
negligible.
Revenues from the sale of products are recog-
nised when the risks and rewards of ownership of
the goods are transferred to the customer, the sales
price is agreed or determinable and receipt of pay-
ment can be assumed. Revenues are stated net of
discounts, allowances, settlement discount and
rebates. With effect from 2002, revenues on long-
term construction work in accordance with IAS 18
(Revenue) and IAS 11 (Construction Contracts) are
no longer recognised by reference to the stage of
completion (percentage of completion method),
since the effect on the income statement is not ma-
terial for the BMW Group. Revenues and expenses
in this case are recognised when sales invoices are
Foreign currency receivables and payables in the
single entity accounts of BMW AG and subsidiaries
are recorded at cost. Exchange gains and losses
computed at the balance sheet date are recognised
as income or expense.
The exchange rates of the significant currencies
have moved against the Euro as follows:
raised. Revenues also include lease rentals and in-
terest income from financial services.
Income on assets for which a group company
retains a repurchase commitment (buy-back con-
tracts)
are not recognised until the assets have finally
left the Group.These assets are included in invento-
ries until that date.
Cost of sales comprises the cost of manufac-
turing products which have been sold and the acqui-
sition cost of purchased merchandise. It includes
directly attributable material and production costs
and all indirect production overheads.These include
depreciation of property, plant and equipment and
amortisation of other intangible assets relating to
production and write-downs on inventories. Cost of
sales also includes costs which are directly attribut-
able
to the leasing business and interest expense
arising from the refinancing of financial services.
Research costs and development costs
which are not capitalised are recognised as an
expense when incurred.
[6]Accounting
principles
Closing rate Average rate
31.12. 2002 31.12. 2001 2002 2001
US Dollar 1.04 0.88 0.95 0.90
British Pound 0.65 0.61 0.63 0.62
South African Rand 9.02 10.53 9.90 7.70
Japanese Yen 123.96 115.48 118.08 108.73