Siemens 2005 Annual Report Download - page 111

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Capital resources and capital requirements
Siemens is committed to a strong financial profile, characterized by a conservative capital struc-
ture that gives us excellent financial flexibility.
Ratings
Our current corporate credit ratings from Moody’s Investors Service and Standard & Poor’s are
noted below:
Moody’s Investor Service rates our long-term corporate credit Aa3 (stable outlook). The rating
classification of Aa is the second highest rating within the agency’s debt ratings category. The
numerical modifier 3 indicates that our long-term debt ranks in the lower end of the Aa category.
The Moody’s rating outlook is an opinion regarding the likely direction of an issuer’s rating over
the medium-term. Rating outlooks fall into the following six categories: Positive, Negative, Stable,
Developing, Ratings Under Review and No Outlook.
Moody’s Investors Service’s rating for our short-term corporate credit and commercial paper
is P-1, the highest available rating in the prime rating system, which assesses issuers’ ability to
honor senior financial obligations and contracts. It applies to senior unsecured obligations with
an original maturity of less than one year.
Standard & Poor’s rates our long-term corporate credit AA– (stable outlook). Within Standard
& Poor’s long-term issue and issuer credit ratings, an obligation rated AA has the second highest
rating category assigned. The modifier “–” indicates that our long-term debt ranks in the lower
end of the AA category. The Standard & Poor’s rating outlook is an opinion regarding the likely
direction of an issuer’s rating over the intermediate to longer term. Rating outlooks fall into the
following four categories: Positive, Negative, Stable and Developing.
Our short-term debt and commercial paper is rated A–1+ within Standard & Poor’s short-term
issue credit ratings, giving Siemens the highest-ranking short-term rating.
Siemens has no other agreements with nationally recognized statistical rating organizations
to provide long-term and short-term credit ratings.
The rating agencies have focused more specifically on an assessment of liquidity risk. Moody’s
most recent liquidity risk assessment for Siemens as of August 24, 2005 classified the liquidity
profile of the Company as “very healthy.”
Management’s discussion and analysis
Consolidated Financial Statements Notes to Consolidated Financial Statements
Moody’s
Investors Standard
Service & Poor’s
Long-term debt Aa3 AA–
Short-term debt P-1 A–1+