Coca Cola 2005 Annual Report Download - page 87

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THE COCA-COLA COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5: GOODWILL, TRADEMARKS AND OTHER INTANGIBLE ASSETS (Continued)
deposit laws in Germany led to discount chains creating proprietary packages that could only be returned to
their own stores. These proprietary packages were continuing to gain market share and customer acceptance.
At the end of 2004, the German government passed an amendment to the mandatory deposit legislation
that requires retailers, including discount chains, to accept returns of each type of nonrefillable beverage
containers that retailers sell, regardless of where the beverage package type was purchased. In addition, the
mandatory deposit requirement was expanded to other beverage categories. The amendment allows for a
transition period to enable manufacturers and retailers to establish a national take-back system for nonrefillable
packages. The transition period is expected to last at least until mid-2006. In the second half of 2005, the
Company was able to gain limited availability of our products in the discount retail channel.
NOTE 6: ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued expenses consisted of the following (in millions):
December 31, 2005 2004
Trade accounts payable and other accrued expenses $ 2,315 $ 2,309
Accrued marketing 1,268 1,194
Accrued compensation 468 438
Sales, payroll and other taxes 215 222
Container deposits 209 199
Accrued streamlining costs (refer to Note 18) 18 41
Accounts payable and accrued expenses $ 4,493 $ 4,403
NOTE 7: SHORT-TERM BORROWINGS AND CREDIT ARRANGEMENTS
Loans and notes payable consist primarily of commercial paper issued in the United States and a liability to
acquire the remaining approximate 59 percent of CCEAG’s outstanding stock. The Company currently owns 41
percent of CCEAG’s outstanding stock. In February 2002, the Company acquired control of CCEAG and agreed
to put/call agreements with the other shareowners of CCEAG, which resulted in the recording of a liability to
acquire the remaining shares in CCEAG no later than December 31, 2006. The present value of the total
amount likely to be paid by our Company to all other CCEAG shareowners was approximately $941 million at
December 31, 2005, and approximately $1,041 million at December 31, 2004. This amount increased from the
initial liability of approximately $600 million due to the accretion of the discounted value to the ultimate
maturity of the liability, as well as approximately $222 million of translation adjustment related to this liability.
The accretion of the discounted value to its ultimate maturity value is recorded in the line item other loss—net,
and this amount was approximately $60 million, $58 million and $51 million, respectively, for the years ended
December 31, 2005, 2004 and 2003.
As of December 31, 2005 and 2004, we had approximately $3,311 million and $4,235 million, respectively,
outstanding in commercial paper borrowings. Our weighted-average interest rates for commercial paper
outstanding were approximately 4.2 percent and 2.2 percent per year at December 31, 2005 and 2004,
respectively. In addition, we had $1,794 million in lines of credit and other short-term credit facilities available as
of December 31, 2005, of which approximately $266 million was outstanding. This entire outstanding amount of
approximately $266 million related to our international operations. Included in the available credit facilities
85