Judgments and Estimates

During the fiscal year, no voting rights were exercised and no balance-sheet-related arrangements were made which, if exercised or arranged differently, would have had a material effect on the assets, earnings, and financial position.

Information about the effect of estimates, assumptions, and judgments made especially in connection with the valuation of the property, plant and equipment, intangible assets, goodwill, doubtful debts, pension liabilities, provisions, contingencies, and tax expenses is presented on here of the Notes to the Consolidated Financial Statements.

A past decision that was significant for the balance sheet concerned the construction of the new company headquarters. In the fiscal year 2002, Bechtle concluded a lease for the central logistics and administration building in Neckarsulm, Germany. Alternatively, the building could have been purchased. In this case, the acquisition costs of about 31 million euros for the building would have had to be entered in the balance sheet as an asset under property, plant and equipment, which would have increased the non-current assets and the investment ratio in the subsequent fiscal years. Depending on the financing mode, the assets and financial position could have been affected substantially. Debt financing would have increased the long-term debts, and the resulting balance extension would have reduced the equity ratio. The use of cash and cash equivalents for financing purposes would have resulted in a reduction of the financial flexibility.

In connection with the accounting of provisions for pensions, Bechtle does not recognise the actuarial gains and losses according to the so-called corridor method (IAS 19.92), but always directly in the equity in their full amount in the period in which they accrue, according to IAS 19.93A. Thus, all actuarial losses that accrued until the balance-sheet date have been fully recognised and presented in the equity. Had the corridor method been used, only a certain part of the actuarial gains and losses would have been entered in the respective reporting period and recognised in the income statement.

At the time of addition of financial assets or financial liabilities, there is a one-time option to measure the asset or liability at fair value in the income statement (IAS 39.9). So far, Bechtle has not made use of this option and measures granted credit and receivables at amortised cost and financial assets available for sale at fair value directly in equity. So far, the use of the option for measurement at fair value in the income statement would not have resulted in any major changes in the valuations.