NOTES
TO THE NOVARTIS GROUP CONSOLIDATED FINANCIAL STATEMENTS
34. SIGNIFICANT DIFFERENCES BETWEEN IFRS AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES (US GAAP) (CONTINUED)
34.11)
ADDITIONAL US GAAP DISCLOSURES:
(I)
EARNINGS PER SHARE:
(II)
EFFECT OF NEW ACCOUNTING PRONOUNCEMENTS:
US
GAAP: In March 2005 the FASB published Interpretation 47 Accounting
for Conditional Asset Retirement Obligations– an interpretation of FASB
Statement No. 143, which clarifies the term conditional asset retirement obligation
used in FAS 143. It will become effective for periods beginning on or after December
15, 2005 and is not expected to have a material impact on the Group’s consolidated
financial statements.
In May 2005 the FASB published
FAS 154 Accounting changes and error corrections as a replacement of APB
Opinion No. 20 Accounting changes and FASB Statement No. 3 Reporting
Accounting Changes in Interim Financial Statements, which has to be applied
for financial years beginning on or after December 15, 2005. It requires to recognize
changes in accounting principles retrospectively, instead of including the effect
in net income of the period as was prescribed by APB Opinion No. 20. Novartis
will apply the standard to the financial year beginning on January 1, 2006.
IFRS: In August 2005 the IASB published
IFRS 7 Financial Instruments: Disclosures which will be replacing IAS 30
Disclosure in the financial statements of banks and similar financial institutions
and IAS 32 Financial Instruments: Disclosure and Presentation. Novartis
plans to adopt the standard for the 2006 Annual Report.
