ArcelorMittal Annual Report 2008

Notes to the Consolidated Financial Statements continued
ArcelorMittal and Subsidiaries
(millions of U.S. dollars, except share and per share data)
Note 6: Inventories
Inventory, net of allowance for slow-moving, excess of cost over net realizable value or obsolete inventory, of 799 and 3,519 as of
December 31, 2007 and 2008, respectively, is comprised of the following:
Finished products 8,108 7,788
Production in process 4,582 4,501
Raw materials 6,739 9,771
Manufacturing supplies, spare parts and other 2,321 2,681
Total 21,750 24,741
The amount of inventory pledged as collateral was 217 and 352 as of December 31, 2007 and 2008 respectively.
The movement in the allowance for slow-moving, excess of cost over net realizable value or obsolete inventory is as follows:
The cost of inventories recognized as an expense during the period was 43,455 and 42,433 in 2007 and 2008, respectively.
The amount of write-down of inventories to net realizable value recognized as an expense within cost of sales in the statement
of income is 483 and 3,049 in 2007 and 2008, respectively, and has been reduced by 407 and 303 for the reversal of such
write-downs in 2007 and 2008, respectively.
Note 7: Prepaid Expenses and Other Current Assets
The other current assets consist of advance payments to taxing and other public authorities (including value-added tax (“VAT”)),
positive fair values of derivative financial instruments, advances to employees, prepayments, accrued interest, dividends receivable
and other miscellaneous receivables.
100
December 31, December 31,
2007 2008
Balance at Deductions/ Balance at
December 31, 2006 Additions Releases Others December 31, 2007
602 483 (407) 121 799
Balance at Deductions/ Balance at
December 31, 2007 Additions Releases Others December 31, 2008
799 3,049 (303) (26) 3,519
December 31, December 31,
2007 2008
VAT recoverable short-term 1,312 1,758
Income tax receivable 504 837
Other 2,828 1,844
Total 4,644 4,439