Connect - Schneider Electric
Connect - Schneider Electric
Connect - Schneider Electric
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5 CONSOLIDATED FINANCIAL STATEMENTS<br />
NOTES TO THE CONSOLIDATED FINANCIAL<br />
Note 23 Provisions<br />
Economic<br />
risks<br />
Customer<br />
risks<br />
196 2011 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC<br />
Products<br />
risks<br />
Environmental<br />
risks Restructuring Other risks Provisions<br />
Dec 31, 2009 418 80 264 44 210 132 1,148<br />
Long-term portion 131 31 79 27 28 80 375<br />
Additions 117 18 150 3 39 75 402<br />
Discounting effect - - 1 - - (4) (3)<br />
Utilizations<br />
Reversals of surplus<br />
(36) (9) (95) (2) (124) (34) (300)<br />
provisions (75) (9) (17) - (19) (8) (128)<br />
Translation adjustments<br />
Changes in the scope<br />
16 4 16 2 5 3 46<br />
of consolidation and other 174 2 90 8 13 12 299<br />
Dec 31, 2010 614 86 409 55 124 176 1,464<br />
Long-term portion 275 35 104 26 21 127 588<br />
Additions 159 5 143 8 87 69 471<br />
Discounting effect 1 - - - - - 1<br />
Utilizations<br />
Reversals of surplus<br />
(82) (8) (109) (5) (77) (60) (341)<br />
provisions (53) (6) (29) (1) (9) (38) (136)<br />
Translation adjustments<br />
Changes in the scope<br />
8 1 3 - - 2 14<br />
of consolidation and other 92 9 3 - 12 51 167<br />
Dec 31, 2011 739 87 420 57 137 200 1,640<br />
Long-term portion 388 34 81 28 18 131 680<br />
(a) Economic risks<br />
These provisions cover, in particular, tax risks arising from audits<br />
performed by local tax authorities and fi nancial risks arising primarily<br />
on guarantees given to third parties in relation to certain assets<br />
and liabilities.<br />
Variations in scope of consolidation and others amount to<br />
EUR92 million and are principally related to Leader & Harvest, Steck<br />
and Luminous acquisitions .<br />
(b) Customer risks<br />
These provisions are primarily established to covers risks arising<br />
from products sold to third parties. This risk mainly consists of<br />
claims based on alleged product defects and product liability.<br />
Provisions for customer risks also integrate the provisions for<br />
losses at completion for a number of long term contracts, for<br />
EUR18 million.<br />
(c) Product risks<br />
These provisions comprise:<br />
• statistical provisions for warranties: the Group funds provisions<br />
on a statistical basis for the residual cost of <strong>Schneider</strong> <strong>Electric</strong><br />
product warranties not covered by insurance;<br />
• provisions for disputes over defective products;<br />
• provisions to cover disputes related to recalls of clearly<br />
identifi ed products.<br />
(d) Environmental risks<br />
These provisions are primarily funded to cover cleanup costs.