annual report - FIAT SpA

NOTES TO THE
STATUTORY FINANCIAL STATEMENTS
PRINCIPAL ACTIVITIES
Fiat S.p.A. (the “Company”) is a corporation organized under the laws of the Republic of Italy and is the Parent
Company of the Fiat Group, holding interests, either directly or indirectly through sub-holdings, in the parent companies
of business Sectors through which the Fiat Group operates.
The Company's head office is in Turin, Italy.
The financial statements of Fiat S.p.A. are prepared in euros which is the Company’s functional currency.
The Income Statement and Statement of Financial Position are presented in euros, while the Statement of
Comprehensive Income, the Statement of Cash Flows and the Statement of Changes in Equity and amounts provided
in the Notes are in thousands of euros, except where otherwise stated.
As the Parent Company, Fiat S.p.A. has also prepared consolidated financial statements for the Fiat Group for the year
ended 31 December 2010.
Demerger and presentation of assets and liabilities to be demerged
Pursuant to the Deed of Demerger executed on 16 December 2010, the Demerger – approved by the Shareholders of
Fiat S.p.A. and Fiat Industrial S.p.A. on 16 and 17 September 2010, respectively – became effective on 1 January
2011. The Demerger consisted of the transfer by Fiat S.p.A. of its shareholdings in companies operating in the
Agricultural and Construction Equipment (CNH), Trucks and Commercial Vehicles (Iveco) and related powertrain (FPT
Industrial) sectors, in addition to other assets and liabilities detailed in the Demerger Plan (and described further on in
this document), to Fiat Industrial S.p.A.
Pursuant to IFRS 5 – Assets held for sale and discontinued operations, in the statement of financial position of the
parent company for the year ended 31 December 2010, Assets to be Demerged and Liabilities to be Demerged are
presented separately from other assets and liabilities due to the fact that they constitute a “disposal group”. Details of
the component elements of those line items are provided in Note 18 to the Financial Statements.
Finally, as the Demerger is a “business combination involving entities or businesses under common control", it is
outside the scope of application of IFRS 3 and IFRIC 17. Accordingly, no adjustment to the carrying amount of assets
and liabilities to be demerged has been made. For the purposes of the statutory financial statements, given Fiat
S.p.A.’s role as a holding company, the classification of Discontinued Operations does not exist and therefore the value
of that line item in the income statement is zero.
SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
The 2010 financial statements represent the separate financial statements of the Parent Company, Fiat S.p.A., and
have been prepared in accordance with the International Financial Reporting Standards (“IFRS”) issued by the
International Accounting Standards Board (“IASB”) and adopted by the European Union, and with provisions
implementing Article 9 of Legislative Decree 38/2005. The designation “IFRS” also includes all valid International
Accounting Standards (“IAS”), as well as all interpretations of the International Financial Reporting Interpretations
Committee (“IFRIC”), formerly the Standing Interpretations Committee (“SIC”).
In compliance with European Regulation 1606 of 19 July 2002, beginning in 2005 the Fiat Group adopted the
International Financial Reporting Standards (“IFRS”), issued by the International Accounting Standards Board (“IASB”),
for the preparation of its consolidated financial statements. On the basis of national legislation implementing that
Regulation, those accounting standards were also used to prepare the separate financial statements of the Parent
Company, Fiat S.p.A., for the first time for the year ended 31 December 2006. The information required by IFRS 1 –
First-time Adoption of International Financial Reporting Standards relating to the effects of the transition to IFRS was
provided in an Appendix to the 2006 separate financial statements.
The financial statements are prepared under the historical cost convention, modified as required for the valuation of
certain financial instruments, as well as on the going concern assumption. In this respect, despite the continuing
difficult economic and financial environment, the Fiat Group’s assessment is that no material uncertainties (as defined
in paragraph 25 of IAS 1) exist about its ability to continue as a going concern, in view also of the measures already
taken to adapt to the changed levels of demand and Fiat Group’s industrial and financial flexibility.
Fiat S.p.A. – Statutory Financial Statements at 31 December 2010 263