Fiat Group - Consolidated Financial Statements and Notes - Fiat SpA

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208 Consolidated Financial Statements at 31 December 2011 Notes The present value of the defined benefit obligations, the fair value of plan assets and the surplus or deficit of the plans at the end of 2011 and the four previous years are as follows: At 31 December At 31 December At 31 December At 31 December At 31 December (€ million) Present value of obligation: 2011 2010 (*) 2009 2008 2007 Pension benefits 25,201 522 2,568 2,267 2,730 Health care and life insurance plans 2,070 1 794 848 817 Employee leaving entitlements in Italy 763 811 1,001 1,062 1,133 Others 156 127 258 288 279 Fair value of plan assets: Pension benefits 20,004 327 1,796 1,554 2,036 Health care and life insurance plans - - 46 39 47 Surplus (deficit) of the plan: Pension benefits (5,197) (195) (772) (713) (694) Health care and life insurance plans (2,070) (1) (748) (809) (770) Employee leaving entitlements in Italy (763) (811) (1,001) (1,062) (1,133) Others (*) The amounts relate to Continuing Operations. (156) (127) (258) (288) (279) The best estimate of expected contributions to pension benefits and health care and life insurance plans for 2012 is as follows: (€ million) 2012 Pension benefits 509 Health care and life insurance plans 143 Others 5 Total expected contributions 657 27. Other provisions Changes in Other provisions are as follows: At Change in At 31 December Release to Other the scope of 31 December (€ million) 2010 (*) Charge Utilisation income changes consolidation 2011 Warranty provision 970 1,421 (1,135) (202) 220 2,256 3,530 Restructuring provision 202 108 (82) (35) (3) 150 340 Investment provision 26 - - - (2) - 24 Other risks 2,022 4,424 (4,109) (234) 203 2,398 4,704 Total Other provisions 3,220 5,953 (5,326) (471) 418 4,804 8,598 (*) Amount relates to the Continuing Operations. The effect of discounting these provisions, €11 million in 2011 has been included in Other changes together with translation gains of €425 million.
The warranty provision represents the best estimate of commitments given by the Group for contractual, legal, or constructive obligations arising from product warranties given for a specified period of time beginning at the date of sale to the end customer. This estimate has been calculated considering the Group’s past experience and specific contractual terms. The provision also includes management’s best estimate of the costs that are expected to be incurred in connection with product defects that could result in a general recall of vehicles, which is estimated by making an assessment of the historical occurrence of defects on a case-by-case basis. The restructuring provision at 31 December 2011 consists of termination benefits of €208 million payable to employees in connection with restructuring plans, manufacturing rationalisation costs of €26 million and other costs of €106 million. These provisions relate to business restructuring programs in the following sectors (in € million): Chrysler 116, Fiat Group Automobiles 110, Components 50, Fiat Powertrain 15, Production Systems 8, Metallurgical Products 4, other sectors 37. The restructuring provision for Continuing Operations at 31 December 2010 consisted of termination benefits of €162 million payable to employees in connection with restructuring plans, manufacturing rationalisation costs of €27 million and other costs of €13 million. These provisions related to business restructuring programs in the following sectors (in € million): Fiat Group Automobiles 88, Components 48, Fiat Powertrain 17, Production Systems 10, Metallurgical Products 7, other sectors 32. The provision for other risks represents the amounts provided by the individual companies of the Group in connection mainly with contractual and commercial risks and disputes. Details of this item are as follows: (€ million) At 31 December 2011 At 31 December 2010 (*) Sales incentives 2,288 378 Legal proceedings and other disputes 608 535 Commercial risks 400 277 Environmental risks 41 33 Indemnities 66 60 Other reserves for risk and charges 1,301 739 Total Other risks (*) The amounts relate to Continuing Operations. 4,704 2,022 A description of these follows: Sales incentives - this provision relates to sales incentives that are offered on a contractual basis to the Group’s dealer networks, primarily on the basis of that dealers will achieve a specific cumulative level of sales transactions during the calendar year. This provision is estimated based on the information available regarding the sales made by the dealers during the calendar year. The provision also includes sales incentives such as cash rebates announced by the Group and provided by dealers to customers, for which the dealers are reimbursed. The Group records this provision when it is probable that the incentive will be provided and the Group’s inventory is sold to its dealers. The Group estimates this provision based on the expected use of these rebates with respect to the volume of vehicles that has been sold to the dealers. Legal proceedings and other disputes - this provision represents management’s best estimate of the liability to be recognised by the Group with regard to: Legal proceedings arising in the ordinary course of business with dealers, customers, suppliers or regulators (such as contractual or patent disputes). Legal proceedings involving claims with active and former employees. Legal proceedings involving different tax authorities. None of these provisions is individually significant. Each Group company recognises a provision for legal proceedings when it is deemed probable that the proceedings will result in an outflow of resources. In determining their best estimate of the liability, each Group company evaluates their legal proceedings on a case-by-case basis to estimate the probable losses that typically arise from events of the type giving rise to the liability. Their estimate takes into account, as applicable, the views of legal counsel and other experts, the experience of the Group and others in similar situations and the Group’s intentions with regard to further action in each proceeding. Fiat’s consolidated provision combines these individual provisions established by each of the Group’s companies. 209 Consolidated Financial Statements at 31 December 2011
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Fiat Group Consolidated Financial S
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Consolidated Statement of Comprehen
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Consolidated Statement of Financial
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Statement of Changes in Consolidate
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Consolidated Statement of Financial
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Notes to the Consolidated Financial
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Associates Associates are enterpris
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Intangible assets Goodwill Goodwill
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If indications of impairment are pr
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Sales of receivables The Group sell
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Revenue recognition Revenue is reco
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Business combinations As discussed
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Accounting standards, amendments an
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Scope of consolidation Fiat Demerge
Page 29 and 30: The main aggregate amounts related
Page 31 and 32: Finally, in January 2012 Fiat annou
Page 33 and 34: Goodwill arising from the acquisiti
Page 35 and 36: Composition and principal changes 1
Page 37 and 38: Reconciliation to the income statem
Page 39 and 40: The reconciliation between the tax
Page 41 and 42: In particular, at 31 December 2011
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Page 45 and 46: For the Ferrari sector, the cash-ge
Page 47 and 48: In 2011 and in 2010 changes in the
Page 49 and 50: In 2011 and 2010, Changes in accumu
Page 51 and 52: Additions of €3,925 million in 20
Page 53 and 54: Disposals and other changes, showin
Page 55 and 56: At 31 December 2011, Inventories in
Page 57 and 58: Receivables from financing activiti
Page 59 and 60: The fair value of derivative financ
Page 61 and 62: In respect of derivative financial
Page 63 and 64: Key financial and income statement
Page 65 and 66: As a result of the above-mentioned
Page 67 and 68: In order to maintain the necessary
Page 69 and 70: Non-controlling interest The non-co
Page 71 and 72: Changes during the year were as fol
Page 73 and 74: 26. Provisions for employee benefit
Page 75 and 76: Other provisions for employees and
Page 77 and 78: The amounts recognised in the state
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Page 83 and 84: The annual interest rates and the n
Page 85 and 86: The bonds issued by the Fiat Group
Page 87 and 88: Payables represented by securities
Page 89 and 90: 29. Trade payables Trade payables o
Page 91 and 92: 32. Guarantees granted, commitments
Page 93 and 94: Instead, when it is probable that a
Page 95 and 96: (€ million) FGA Maserati Ferrari
Page 97 and 98: (€ million) FGA Maserati Ferrari
Page 99 and 100: In order to test for impairment, si
Page 101 and 102: Counterparties to these agreements
Page 103 and 104: 36. Fair value measurement IFRS 7 r
Page 105 and 106: The main effects on profit and loss
Page 107 and 108: An analysis of the effects of relat
Page 109 and 110: Appendix I Fiat Companies at 31 Dec
Page 111 and 112: SubSidiarieS conSolidated on a line
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ASSoCIATED CoMpAnIES VAlUED AT CoST
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Attestation of the Consolidated Fin
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Fiat Group - Consolidated Financial Statements and Notes - Fiat SpA

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