Inventories are recognized at the lower of cost of purchase or production cost, or the net realizable value. The cost of pur­chase or production cost is calculated using the weighted average cost method. The net realizable value corresponds to the estimated sales proceeds less the estimated cost of comple­tion.

Material costs incurred before the start of installation of an elevator or escalator are recognized as inventory for customer contracts at the lower of production cost or the net realiz­able value. With the start of revenue recognition, inventory for customer contracts is transferred to contract balances.

Inventory allowances are recognized for slow-­moving stock. Technically obsolete items are written off.