Siemens AG: Identifying differences and similarities between IFRS and GAAP (LO 10-11) Presented below are excerpts from the 2018 annual report of Siemens AG, a German company that operates in numerous industries, including technology, power generation, and medical diagnostics. NOTE 1 Basis of presentation InventoriesInventories are valued at the lower of acquisition or production costs and net realizable value, costs being generally determined on the basis of an average or first-in, first-out method. NOTE 11 Inventories NOTE" Inventories Raw materials and supplies Work in progress Finished goods and products heul tor resale Advances to suppliers 3.165 3.871 763 13,885 Sep 30. 6. 169 790 13.885 Cost of sales includes inventories recognized as expense amounting to 57,029 million and 57,176 million, respectively, in fiscal 2018 and 2017. Compared to prior year, write-downs increased (decreased) by (19) million and 15 million as of September 30, 2018 and 2017. Source: Siemens AG 2018 annual report.