NOTES TO THE CONSOLIDATED INCOME STATEMENTS OF TRANSAMERICA FINANCE CORPORATION REVENUE RECOGNITION Finance charges are generally recognized on an effective yield method. Charges collected in advance on distribution finance receivables are taken into income on a straight-line basis over the periods to which the charges relate, which generally average ninety days. Related origination and other non-refundable fees and direct origination costs are deferred and amortized as adjustments of finance charges over the contractual life of the transactions. Accrual of finance charges is suspended on accounts that contractually become past due in excess of ninety days or at the discretion of management.  Leasing revenues are earned on service, rental and term operating leases. Rental revenues are recognized in the period billed. Revenues from service contract minimum and term leases are recognized on a straight-line basis over the lease term. Initial direct costs are amortized on a straight-line basis over the lease term. Real estate service revenues are primarily fees for life of loan property tax payment and reporting services and flood certifications. Life of loan service fees are deferred and recognized in income over the expected service period. Transamerica Finance Corporation periodically reviews its revenue recognition method to determine the expected life of a contract and/or whether prepayment speeds used have changed. Accordingly, TFC may adjust the deferral period to reflect current trends.  TFC employed 2,104 people at December 31, 2003 (2002: approximately 3,900 and 2001: approximately 4,700). The following table provides the information underlying the calculation of net income per share. Net income per share excludes dilution and is computed by dividing net income available to common shareholders, which is after deduction of dividends on the preferred shares, by the weighted average number of common shares (EUR 0.12 par value) outstanding. Fully diluted net income per share is computed based on the weighted average number of common shares outstanding during the year plus dilutive potential common shares considered outstanding during the year (treasury stock method). The weighted average number of common shares has been adjusted retroactively for all periods presented to reflect stock dividends. 33 NET INCOME PER SHARE 2003 2002 2001 Net income 1,793 1,547 2,397 Dividend on preferred shares (95) (30) (3) Net income available for common shareholders 1,698 1,517 2,394 Interest on convertible debt — — — NET INCOME USED IN CALCULATION DILUTED NET INCOME PER SHARE 1,698 1,517 2,394 Numbers in millions Weighted average number of common shares outstanding 1,476 1,458 1,412 Dilutive effects from: — options — — 6 — convertible debt — — 1 MAXIMUM WEIGHTED AVERAGE NUMBER OF COMMON SHARES 1,476 1,458 1,419 Amounts in EUR Net income per share 1.15 1.04 1.70 Net income per share fully diluted 1.15 1.04 1.69 AEGON GROUP ANNUAL REPORT 2003 125 2003 2002 2001 BREAKDOWN OF NET INCOME FROM OPERATIONS BY SEGMENT Commercial lending 217 94 87 Leasing 7 (9) (12) Real estate information 75 42 42 Other (57) (39) 8 NET INCOME FROM OPERATIONS 242 88 125 2003 2002 2001 SALARIES AND OTHER EMPLOYEE COSTS Salaries 246 261 319 Pension expenses (6) (4) (6) Social security charges 11 14 15 Other employee costs 35 61 37 TOTAL 286 332 365