VÝROČNÍ ZPRÁVA ANNUAL REPORT - Philip Morris

ANNUAL REPORT 2008 | CONSOLIDATED FINANCIAL RESULTS
Loans and deposits with related parties include interest-bearing, on-demand deposits (cash pool) of CZK 1 360 million with Philip Morris Finance S.A.
(2007: CZK 2 217 million). The interest-bearing on-demand deposits are classified as Cash and cash equivalents in the Company’s balance sheet
as at December 31, 2008 and 2007.
The interest rate for on-demand deposits is calculated as overnight PRIMEAN - 0.25%. The actual interest rates reflect the current money market and the
nature of the loan. The average effective interest rate of on-demand deposits was 3.171% p.a. (2007: 2.466% p.a.) in the Czech Republic and 3.66% p.a. in the
Slovak Republic.
Borrowings from related parties as at December 31, 2008 include interest-bearing on-demand borrowings (cash pool) and interest-bearing short-term
borrowing with a maturity less than three months with Philip Morris Finance S.A. The average interest rate of interest bearing on-demand borrowings in EUR
was 2.51% p.a. and in SKK was 2.45% p.a. (2007: 3.58% p.a.). In 2007, the interest rate for short-term borrowings from related party was 4.72% p.a.
d) Key management compensation
Key management compensation reflects the remuneration of members of the Board of Directors and the Supervisory Board. The members of the Board of
Directors and the Supervisory Board who are employees of the Group or an entity within the PMI Group receive no additional compensation for services as
members of the Board of Directors and the Supervisory Board. Remuneration of members of the Supervisory Board who are non-employees of the Group or an
entity within the PMI Group comprises an annual fee.
The compensation of members of the Board of Directors and the Supervisory Board who are employees of the Company or an entity within the PMI Group
comprises an annual base salary, bonuses based on individual performance, termination benefits, share-based payments and other income in-kind such as cars
for use, lunch allowances, pension contributions, life and accident insurance. In addition to this, the members of the Board of Directors who are employees of
Philip Morris Services S. A. or other entities of PMI also have other income in-kind such as the payment of rent and school fees.
(in CZK million) 2008 2007
Salaries and other short-term employee benefits 39 52
Share-based payments 8 10
Income in-kind 10 7
Total 57 69
The term of office for Board of Directors and Supervisory Board members is one year. No member of the Board of Directors and the Supervisory Board are under
contract for the exercise of their function as members of the Board of Directors or the Supervisory Board.
e) Information on the number of shares issued by the Company to Executives
Members of the Board of Directors owned no shares in 2008 and 2007, members of the Supervisory Board owned 7 shares in 2008 (2007: 1).
28. SUBSEQUENT EVENTS
No subsequent events have occurred after December 31, 2008 that would have a material impact on these financial statements at December 31, 2008.
Statutory signatures
The consolidated financial statements were authorised for issue by the Board of Directors and have been signed below on its behalf.
March 19, 2009
Alvise Giustiniani
Chairman of the Board of Directors
Daniel Gordon
Member of the Board of Directors
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