Annual r eport 2002 Annual r eport 2002 - Boskalis

Financial Statements 2002
Tangible fixed assets
The book value of tangible fixed assets is calculated by deducting the accumulated depreciation charges
from the cost of acquisition. Interest paid during construction is not capitalized. Investment grants
received as subsidies for the building of sea-going vessels are deducted from the acquisition cost.
Large equipment commissioned since 1996 is depreciated on the basis of acquisition cost.
The depreciation charges are based upon the expected economic life of the assets. For the fleet, life
expectancy is in general 15-18 years and for other construction equipment it is an average of 5 years.
Large equipment commissioned before 1996 is depreciated using the declining balance method on
the basis of a fixed percentage of the book value, taking into account an estimated residual value.
Investments in floating and other contract-related construction equipment are depreciated over a
shorter period of time.
The remaining assets are depreciated on the basis of a fixed percentage of the acquisition cost,
based upon a period of use of 10-50 years for buildings, and 4 years for furniture, fixtures and fittings,
etc. Land is not depreciated, with the exception of land for sand production, which is depreciated
according to the tonnage principle.
The long-term operational lease agreement for the trailing suction hopper dredger Stuyvesant concluded
by a foreign group company has not been capitalized due to the fact that Royal Boskalis
Westminster nv is not the economic owner of this vessel. The financial commitments relating thereto
are accounted for under Commitments and contingent liabilities.
Financial fixed assets
The valuation of associated companies is based upon the Royal Boskalis Westminster nv share in
the net asset value, in accordance with the balance sheets prepared by the companies concerned,
less such provisions as are deemed necessary. Profits made in countries with weak currencies and/or
transfer restrictions are only accounted for when conversion into hard currency has been secured.
The valuation of other financial fixed assets is based upon nominal value or acquisition cost, less
such provisions as are deemed necessary.
Inventory
The inventory consists mainly of consumables and spare parts and is valued at average cost less
such provisions as are deemed necessary.
Work in progress
Work in progress is valued at cost (wages, materials, other direct costs and charges for plant
employed) without any surcharge for general overhead costs. If losses on works in progress are
anticipated, provisions are made.
On large long-term contracts (with a contract value of € 25 million or more), where such calculations can
be made on a reliable basis, profits are accounted for as the work proceeds on the basis of costs incurred.
Progress payments invoiced and advance payments received are deducted from Work in progress.
46
Annual Report 2002