Statement of Directors' responsibilities
Auditor's report - Netherlands
Auditors' report - United Kingdom
Consolidated income statement
Consolidated statement of recognised income and expense
Consolidated balance sheet
Consolidated cash flow statement
Notes to the consolidated accounts
Financial record
Principal group companies and non-current investments
Company accounts

Notes to the consolidated accounts

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1 Accounting information and policies
2 Segment information
3 Gross profit and operating costs
4 Staff costs
5 Net finance costs
6 Taxation
7 Combined earnings per share
8 Dividends on ordinary capital
9 Goodwill and intangible assets
10 Property, plant and equipment
11 Other non-current assets
12 Deferred taxation
13 Inventories
14 Trade and other receivables
15 Cash and cash equivalents and other financial assets
16 Financial liabilities
17 Financial instruments and treasury risk management

18 Trade payables and other liabilities
19 Provisions
20 Pensions and similar obligations
21 Equity
22 Share capital
23 Other reserves
24 Retained profit
25 Commitments and contingent liabilities
26 Acquisitions and disposals
27 Assets held for sale and discontinued operations
28 Reconciliation of net profit to cash flow from operating activities
29 Share-based compensation plans
30 Related party transactions
31 Key management personnel
32 Remuneration of auditors
33 Events after the balance sheet date

13 Inventories

Inventories	€ million 2007	€ million 2006
Raw materials and consumables	1 406	1 360
Finished goods and goods for resale	2 488	2 436
	3 894	3 796

Inventories with a value of €101 million (2006: €96 million) are carried at net realisable value, this being lower than cost. During 2007, €177 million (2006: €160 million) was charged to the income statement for damaged, obsolete and lost inventories. In 2007, €25 million (2006: €34 million) was utilised or released to the income statement from inventory provisions taken in earlier years.

In 2007, inventories with a carrying amount of €4 million were pledged as security for certain of the Group's borrowings (2006: €6 million).