Annual Report 2009 - Husqvarna Group

Notes Husqvarna Annual Report 2009 81
Amounts in SEKm unless otherwise stated.
NOTE 20
Other provisions
Group
Parent Company
Provisions
for
restructuring
Warranty
commitments
Claims Other Total
Provisions
for
restructuring
Warranty
commitments
Other Total
Opening balance, 1 Jan 2008 2 190 326 260 778 — 11 19 30
Provisions made 316 182 3 118 619 56 10 5 71
Acquired companies — — — — — — — — —
Provisions used –54 –164 — –182 –400 — –11 –13 –24
Unused amounts reversed — –7 — –3 –10 — — –3 –3
Exchange-rate differences 0 31 60 37 128 — — — —
Closing balance, 31 Dec 2008 264 232 389 230 1,115 56 10 8 74
Current provisions 264 77 — 88 429 56 10 8 74
Non-current provisions — 155 389 142 686 — — — —
Opening balance, 1 Jan 2009 264 232 389 230 1,115 56 10 8 74
Provisions made 272 281 26 165 744 93 10 17 120
Acquired companies — 2 — — 2 — — — —
Provisions used –270 –268 –3 –159 –700 –79 –10 –7 –96
Unused amounts reversed –15 –9 — –11 –35 — — — —
Exchange rate differences 1 –11 –25 –10 –45 — — — —
Closing balance, 31 Dec 2009 252 227 387 215 1,081 70 10 18 98
Current provisions 171 79 — 91 341 36 10 12 58
Non-current provisions 81 148 387 124 740 34 — 6 40
Provisions for restructuring represent the expected payments
to be incurred in the coming years as a consequence of
Husqvarna operations’ decision to close some factories,
rationalize production and reduce personnel. The amounts
are based on the Husqvarna management’s best estimates
and are adjusted when changes to these estimates are known.
Provisions for warranty commitments are recognized as a consequence
of Husqvarna’s policy of covering the cost of repairing
defective products. A warranty is normally granted for
1 to 2 years after the sale.
Provisions for claims refer to the Group’s captive insurance
companies and consist of reserves for specific insurance
claims as well as IBNR (Incurred But Not Reported) reserves.
Other provisions include mainly payroll related provisions.
NOTE 21
Other liabilities
Group
Parent Company
2009 2008 2009 2008
Accrued holiday pay 184 175 80 73
Other accrued payroll
expenses 419 383 112 114
Other accrued expenses 740 716 150 168
Value added tax 20 20 0 —
Personnel taxes and
other taxes 58 67 23 23
Other operating
liabilities 73 113 0 —
Total 1,494 1,474 365 378
NOTE 22
Contingent liabilities
Group
Parent Company
Guarantees and other
commitments 2009 2008 2009 2008
On behalf of internal
counterparties — — 377 153
On behalf of external
counterparties 54 24 6 7
Total 54 24 383 160
In addition to the above contingent liabilities, guarantees for
fulfillment of contractual undertakings are provided as part of
Husqvarna’s normal course of business. There was no indication
at year-end that any payment will be required in connection
with any contractual guarantees. Furthermore, there is an
obligation, in the event of dealer’s bankruptcy, to buy back
repossessed Husqvarna products from certain North American
dealers financing their floor planning with an external
finance company. During 2009 goods for a value of SEK 10m
(13) were bought back in connection with floor planning
activities.
Husqvarna is involved in commercial, product liability and
other disputes in the ordinary course of business. Such disputes
involve claims for compensatory damages, property
damage or personal injury compensation and occasionally
also punitive damages. Although the company is self-insured
to a certain extent, it is also insured against excessive liability
losses. Husqvarna continuously monitors and evaluates pending
claims and disputes, and take action when deemed necessary.
The company believes that these activities help to minimize
the risks. It is difficult to predict the outcome of each