Note 8. Inventories
Inventories consist of the following:
|Components and raw materials||69,709||74,362|
|Work in process||30,040||30,627|
|Total inventories, gross||144,813||132,852|
|Allowance for obsolescence||(18,883)||(19,350)|
|Total inventories, net||125,930||113,502|
The changes in the allowance for obsolescence are as follows:
|Balance at beginning of year||(23,696)||(18,883)|
|Charged to cost of sales||(2,282)||(5,204)|
|Utilization of the provision||8,514||2,167|
|Foreign currency translation effect||(1,698)||(1,289)|
|Balance at end of year||(18,883)||(19,350)|
On December 31, 2015 our allowance for inventory obsolescence amounted to €19,350, which is 14.6% of total inventory. The major part of the allowance is related to components and raw materials. The addition for the years 2014 and 2015 mainly relate to inventory items which were ceased to be used due to technological developments and design changes which resulted in in obsolescence of certain parts.
The cost of inventories recognized as costs and included in cost of sales amounted to €288.7 million (2014: €234.3 million).