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

Inventories—Inventories 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

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. 

Required:

Using the Siemens AG note, identify the similarities and differences between U.S. GAAP and IFRS regarding inventory accounting.

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Sep 30, (In millions of €) 2018 2017 2,955 Raw materials and supplies Work in progress Finished goods and products held for resale Advances to suppliers 3,165 6,085 6,165 3,871 3,972 763 790 13,885 13,885