Annual Report 2005/06 - voestalpine

Consolidated Financial Statements
esTimaTes
The preparation of consolidated financial
statements in conformity with IFRS requires
estimates and assumptions that affect the
reported amounts of assets and liabilities
and/or income and expenses. Actual results
may differ from these estimates. Estimates
are made with the intention of adhering to
the “true and fair view“ principle.
The estimates and underlying assumptions
are reviewed on an ongoing basis. Revisions
to accounting estimates are recognized in the
period in which the estimate is revised.
reCogniTion oF revenUes
anD eXpenses
Revenues arising from the provision of goods
and services are realized when all major risks
and opportunities arising from the delivered
object have been transferred to the buyer. Operating
expenses are recognized when a
service is rendered or a delivery is received,
or at the time such liability is incurred.
Government grants of EUR 18.7 million
(2004/05: EUR 24.4 million) for investments,
research and development as well as promotion
of job opportunities were recognized in
the consolidated income statement.
Annual Report 2005/06
BorroWing CosTs
All borrowing costs are expensed as incurred.
properTy, planT anD eqUipmenT
Property, plant and equipment are stated at
acquisition cost or manufacturing cost less
accumulated depreciation and any impairment
losses.
The cost of self-constructed assets includes
the cost of materials, direct labor and an
appropriate proportion of production overheads.
Costs of borrowing are recognized in
the consolidated income statement in the
period in which they are incurred.
Depreciation is charged on a straight-line
basis over the estimated useful lives. Land is
not depreciated. The estimated useful lives
are as follows:
Buildings 2.0 – 20.0%
Plant and equipment 3.3 – 25.0%
Fixtures and fittings 5.0 – 20.0%
Investment property is recognized at depreciated
cost.