ABB Annual Report 2012 PDF - ABB Group Annual Report 2012

Financial reviewContents44 Operating and financial review and prospects44 About ABB44 History of the ABB Group44 Organizational structure44 Business divisions46 Management overview48 Application of critical accounting policies52 New accounting pronouncements52 Acquisitions and investments53 Exchange rates54 Orders54 Performance measures55 Analysis of results of operations62 Divisional analysis71 Restructuring71 Capital expenditures71 Liquidity and capital resources73 Financial position75 Cash flows76 Disclosures about contractual obligationsand commitments77 Off balance sheet arrangements77 Related party transactions78 Consolidated Financial Statements84 Notes to the Consolidated Financial Statements84 Note 1 The Company84 Note 2 Significant accounting policies91 Note 3 Acquisitions and increasesin controlling interests94 Note 4 Cash and equivalents and marketablesecurities96 Note 5 Financial instruments100 Note 6 Fair values101 Note 7 Receivables, net103 Note 8 Inventories, net104 Note 9 Other non-current assets104 Note 10 Property, plant and equipment, net105 Note 11 Goodwill and other intangible assets106 Note 12 Debt109 Note 13 Provisions and other currentliabilities and other non-current liabilities109 Note 14 Leases110 Note 15 Commitments and contingencies113 Note 16 Taxes116 Note 17 Employee benefits121 Note 18 Share-based payment arrangements126 Note 19 Stockholders’ equity127 Note 20 Earnings per share128 Note 21 Other comprehensive income128 Note 22 Restructuring and related expenses129 Note 23 Operating segment and geographic data134 Note 24 Compensation135 Report of management on internal controlover financial reporting136 Report of the Statutory Auditor on theConsolidated Financial Statements137 Report of the Group Auditor on internal controlover financial reporting138 Financial Statements of ABB Ltd, Zurich139 Notes to the Financial Statements139 Note 1 General139 Note 2 Receivables139 Note 3 Loans – Group139 Note 4 Participation139 Note 5 Current liabilities140 Note 6 Stockholders’ equity141 Note 7 Contingent liabilities141 Note 8 Bonds141 Note 9 Significant shareholders141 Note 10 Board of Directors compensation143 Note 11 Executive Committee compensation147 Note 12 Share ownership of ABB by Board membersand members of the Executive Committee149 Note 13 Risk assessment150 Proposed appropriation of available earnings151 Report of the Statutory Auditor152 Investor informationABB Annual Report 2011 | Financial review 43