New organisation
As of January 1, 2012, the Volvo Group introduced a new functional organization.

Read more about the Volvo Group's new organization as from January 1, 2012 in Note 6.

Impact on segment reporting
Under the prior organization, the Trucks operations were organized in four business areas, which were aggregated to one reportable segment for Trucks. Under the new organization, the consolidation of the four truck areas into one Trucks business area is further emphasizing the utilization of resources between the different brands to optimize the overall global potential for the Trucks business. Therefore, the overall Truck business is considered one single operating segment under the new organization. The Volvo Group will thus continue to be reported in the six segments Trucks, Construction Equipment, Buses, Volvo Penta, Customer Finance and Group functions and other. The reported segment information is based on the information used internally by the chief operating decision maker, i.e. the Volvo Group CEO.

The heading Group functions and other contains the cost of corporate functions, external business related to the business support functions and the operations within business areas Volvo Rents and Governmental Sales.  

Impact on goodwill impairment testing
The Trucks segment is considered one single cash generating unit (CGU) under the new organization. Goodwill related to the area Trucks are therefore from 2012 evaluated based on the cash generation capacity of the overall Trucks segment.

Restatement of financial reporting for 2011
The implementation of the functional organization has resulted in a reallocation of responsibilities within the Group. As a consequence, certain cost items have been redefined from a functional perspective, causing a shift between the lines in the income statement of the Volvo Group as well as the income statement of the Industrial Operations. In addition, as a result of the reorganization as well as the financial framework, certain sales and cost items are reported differently from a segment reporting perspective from 2012. To facilitate comparability between the years, 2011 income statement and segment reporting data has been restated.

The impact of the restatement of the income statement for 2011 and the segment reporting for 2011 due to the new organization are disclosed below.

Restatement of financial reporting 2011

Year 2011 Industrial Operations   Customer Finance   Volvo Group Total
SEK M Previously reported Restatement After restatement   Previously reported Restatement After restatement   Previously reported Restatement After restatement
Net sales 303,589 303,589   8,883 8,883   310,367 310,367
Cost of sales (231,516) (1,581) (233,097)   (5,693) (5,693)   (235,104) (1,581) (236,685)
Gross income 72,073 (1,581) 70,492   3,190 3,190   75,263 (1,581) 73,682
                       
Research and development expenses (13,276) (13,276)     (13,276) (13,276)
Selling expenses (24,383) (798) (25,181)   (1,618) (1,618)   (26,001) (798) (26,799)
Administrative expenses (7,105) 2,352 (4,753)   (27) 27   (7,132) 2,379 (4,753)
Other operating income and expenses (1,045) (1,045)   (603) (603)   (1,649) (1,649)
Income (loss) from investments in associated companies (82) (82)     (81) (81)
Income from other investments (225) (225)     (225) (225)
Operating income 25,957 (27) 25,930   942 27 969   26,899 26,899
                       
Interest income and similar credits 644 644     608 608
Interest expenses and similar charges (2,912) (2,912)     (2,875) (2,875)
Other financial income and expenses 297 297     297 297
Income after financial items 23,986 (27) 23,959   942 27 969   24,929 24,929
                       
Income taxes (6,490) (6,490)   (323) (323)   (6,814) (6,814)
Income for the period 17,496 (27) 17,469   619 27 646   18,115 18,115
Restatement of segment reporting 2011
Net sales Year 2011
SEK M Previously reported   Restatement   After restatement
Trucks 200,703   (1,783)   198,920
Construction Equipment 64,987   (1,487)   63,500
Buses 22,289   (466)   21,823
Volvo Penta 8,859   (401)   8,458
Volvo Aero 6,509   (153)   6,356
Group function and other including eliminations 242   4,290   4,532
Industrial operations 303,589     303,589
           
Customer Finance 8,882     8,882
Reclassifications and eliminations (2,104)     (2,104)
Volvo Group 310,367     310,367
Operating income Year 2011
SEK M Previously reported   Restatement   After restatement
Trucks 18,260   (33)   18,227
Construction Equipment 6,653   159   6,812
Buses 1,036   78   1,114
Volvo Penta 781   44   825
Volvo Aero 336   24   360
Group functions and other (1,109)   (299)   (1,408)
Industrial operations 25,957   (27)   25,930
           
Customer Finance 942   27   969
Volvo Group 26,899     26,899