Annual Review 2012 - Luxottica
Annual Review 2012 - Luxottica
Annual Review 2012 - Luxottica
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
148 |<br />
ANNUAL REPORT <strong>2012</strong><br />
19. Short-term<br />
PROVISIONS FOR<br />
RISKS AND OTHER<br />
CHARGES<br />
The balance is detailed below:<br />
(thousands of Euro) Legal risk Self-insurance Tax provision Other risks Returns Total<br />
Balance as of December 31, 2011 4,899 5,620 1,796 9,927 31,094 53,337<br />
Increases 1,647 7,395 10,525 11,229 18,233 49,029<br />
Decreases (5,981) (8,186) (132) (8,383) (12,736) (35,419)<br />
Business combinations - - - - - 0<br />
Foreign translation difference and other<br />
movements 14 (60) (39) (296) (534) (914)<br />
Balance as of December 31, <strong>2012</strong> 578 4,769 12,150 12,477 36,057 66,032<br />
Other risks mainly includes provisions for licensing expenses and advertising expenses<br />
required by existing license agreements of Euro 5.3 million (Euro 5.2 million as of December<br />
31, 2011), which are based upon advertising expenses that the Group is required to incur<br />
under the license agreements.<br />
The Company is self-insured for certain losses relating to workers’ compensation, general<br />
liability, auto liability, and employee medical benefits for claims filed and for claims<br />
incurred but not reported. The Company’s liability is estimated using historical claims<br />
experience and industry averages; however, the final cost of the claims may not be known<br />
for over five years.<br />
Legal risk includes provisions for various litigated matters that have occurring in the<br />
ordinary course of business.<br />
The tax provision mainly includes the accrual related to tax audit on <strong>Luxottica</strong> S.r.l. for fiscal<br />
year 2007 of approximately Euro 10.0 million.