VÝROČNÍ ZPRÁVA ANNUAL REPORT - Philip Morris

ANNUAL REPORT 2008 | FINANCIAL RESULTS
Provisions Share based
Deferred tax assets (in CZK million) for inventories payments Other Total
As at January 1, 2007 3 5 10 18
Credit/(charge) to the income statement (1) (1) 5 3
As at December 31, 2007 2 4 15 21
Credit/(charge) to the income statement (2) - (4) (6)
As at December 31, 2008 - 4 11 15
Effective from January 1, 2008, the rate in the Czech Republic changed to 21%. Effective from January 1, 2009 the rate will decrease to 20% and effective from
January 1, 2010 the rate will decrease to 19%.
As at December 31, 2007, deferred tax assets (+) and liabilities (-) were calculated at 21%, 20% and 19% and as at December 31, 2008 at 20% and 19%
(depending upon the period in which the temporary difference is expected to reverse) in accordance with the tax legislation enacted.
14. DIVIDEND INCOME
In 2008, the Company did not receive dividends from Philip Morris Slovakia s. r. o. In 2007, the Company received dividends from Philip Morris Slovakia s. r. o.
in the amount of CZK 39 million distributed from the Subsidiary’s 2006 profit.
15. OTHER INCOME
Other income of CZK 85 million (2007: CZK 92 million) includes interest income received from interest-bearing short-term loans and deposits with related
parties, see Note 27.
16. EXPENSES BY NATURE – ADDITIONAL INFORMATION
(in CZK million) 2008 2007
Changes in inventories of FG and WIP (173) 236
Own work capitalized (25) (2)
Raw materials and consumables used 4 313 4 506
Services 1 499 1 804
Employee benefits expense 809 827
Depreciation and amortisation 366 399
Other 87 48
Costs of goods sold, distribution expenses and administrative expenses 6 876 7 818
17. EMPLOYEE BENEFITS EXPENSE
(in CZK million) 2008 2007
Wages and salaries, including termination benefits CZK 41 million (2007: CZK 54 million) 593 602
Social security and health insurance 70 74
Pension costs – defined contribution plans 120 128
Other employee related costs 26 23
Total 809 827
As at December 31, 2008, the number of employees was 1 070 (2007: 937) including 36 managers (2007: 35). Managers of the Company include employees
who are department heads and senior managers.
Termination benefits recognised in 2008 include a provision for redundancy payments of CZK 20 million recognised as at December 31, 2008 (Note 18).
The Company is legally required to make contributions to government health, pension and unemployment schemes. During 2008 and 2007, the Company paid
contributions at a rate of 35% of gross salaries and is not required to make any contributions in excess of this statutory rate.
The Company has a voluntary pension plan for employees under which the Company makes contributions on behalf of the Company’s employees to approved
pension plan providers, under defined contribution schemes.
Principles of employment and remuneration are covered by the collective agreement. Audit of the observances of labor law regulations in the Company takes
place during the collective labor agreement negotiations.
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