D3. Inventories

AP Accounting principles

Inventories are measured at the lower of cost and net realizable value. Cost is calculated mainly by applying the first-in, first-out (FIFO) principle or weighted average cost formula. The cost of inventories and work in progress includes raw material costs, direct labor, other direct expenses and production-related overheads, based on a normal capacity utilization.

The net realizable value is the calculated sales price received for normal business transactions less calculated sales costs.

Inventories

SEKm

2020

2019

2018

Raw materials and consumables

5,890

4,749

3,937

Spare parts and supplies

1,783

1,862

1,656

Products in progress

1,343

1,424

1,546

Finished products

7,363

7,717

8,090

Advance payments to suppliers

4

12

5

BS Total

16,383

15,764

15,234

Impairment of inventories amounted to SEK 302m (78; 85), of which SEK 9m (70; 61) was recognized in conjunction with restructuring as an item affecting comparability, refer to Note B3 Operating expenses.