Philips 2014 Annual Report Download - page 146

Group nancial statements 12.9 17
146 Annual Report 2014
The changes in the allowance for doubtful accounts
receivable are as follows:
Philips Group
Allowance for doubtful accounts receivable in millions of EUR
2012 - 2014
20121) 20131) 2014
Balance as of January 1 265 230 204
Additions charged to expense 13 29 48
Deductions from allowance2) (49) (33) (46)
Other movements 1 (22) 21
Balance as of December 31 230 204 227
1) Amounts have been revised following reclassication
2) Write-os for which an allowance was previously provided
The allowance for doubtful accounts receivable has
been primarily established for receivables that are past
due.
Included in above balances as per December 31, 2014
are allowances for individually impaired receivables of
EUR 200 million (2013: EUR 172 million; 2012: EUR 194
million).
17 Equity
Common shares
As of December 31, 2014, the issued and fully paid share
capital consists of 934,819,413 common shares, each
share having a par value of EUR 0.20.
In June 2014, Philips settled a dividend of EUR 0.80 per
common share, representing a total value of EUR 729
million. Shareholders could elect for a cash dividend or
a share dividend. 60% of the shareholders elected for
a share dividend, resulting in the issuance of 18,811,534
new common shares. The settlement of the cash
dividend resulted in a payment of EUR 293 million
including tax and service charges.
The following table shows the movements in the
outstanding number of shares:
Philips Group
Outstanding number of shares in number of shares
2013 - 2014
2013 2014
Balance as of January 1 914,591,275 913,337,767
Dividend distributed 18,491,337 18,811,534
Purchase of treasury shares (27,811,356) (28,537,921)
Re-issuance of treasury shares 8,066,511 10,777,489
Balance as of December 31 913,337,767 914,388,869
Preference shares
The ‘Stichting Preferente Aandelen Philips’ has been
granted the right to acquire preference shares in the
Company. Such right has not been exercised. As a
means to protect the Company and its stakeholders
against an unsolicited attempt to acquire (de facto)
control of the Company, the General Meeting of
Shareholders in 1989 adopted amendments to the
Company’s articles of association that allow the Board
of Management and the Supervisory Board to issue
(rights to acquire) preference shares to a third-party. As
of December 31, 2014, no preference shares have been
issued.
Option rights/restricted and performance
shares
The Company has granted stock options on its common
shares and rights to receive common shares in the
future (see note 28, Share-based compensation).
Treasury shares
In connection with the Company’s share repurchase
programs, shares which have been repurchased and are
held in treasury for (i) delivery upon exercise of options,
performance and restricted share programs and
employee share purchase programs, and (ii) capital
reduction purposes, are accounted for as a reduction of
shareholders’ equity. Treasury shares are recorded at
cost, representing the market price on the acquisition
date. When issued, shares are removed from treasury
shares on a rst-in, rst-out (FIFO) basis.
When treasury shares are reissued under the
Company’s option plans, the dierence between the
cost and the cash received is recorded in retained
earnings.
Dividend withholding tax in connection with the
Company’s purchase of treasury shares is recorded in
retained earnings.
The following transactions took place resulting from
employee option and share plans:
Philips Group
Employee option and share plan transactions
2013 - 2014
2013 2014
Shares acquired 3,984 7,254,606
Average market price EUR 22.51 EUR 24.53
Amount paid EUR 0 million EUR 178 million
Shares delivered 8,066,511 10,777,489
Average market price EUR 28.35 EUR 30.26
Cost of delivered shares EUR 229 million EUR 326 million
Total shares in treasury
at year-end 20,650,427 17,127,544
Total cost EUR 618 million EUR 470 million