Siemens 2006 Annual Report Download - page 230

Notes to Consolidated Financial Statements
(in millions of €, except where otherwise stated and per share amounts)
226
■The Company’s audit and compliance departments and an internal task force have been
instructed to continue their internal investigation activities and the examination of our
compliance and internal control system for gaps and any possibilities of circumvention.
The Managing Board and the Audit Committee of Siemens will engage an independent
compliance advisor in order to consult the Managing Board and the Audit Committee with
regard to the future structure of the compliance organization, the execution of compliance
reviews, the review of related guidelines and controls including potential improvement meas-
ures, and the respective communication and training. The independent compliance advisor
will also provide periodic status reports to the Audit Committee.
Furthermore, the Audit Committee of Siemens will conduct a companywide investigation
and engage an independent external law firm which will mandate the involvement of a foren-
sic accounting firm.
Siemens currently can not exclude the possibility that criminal or civil sanctions may be
brought against the Company itself or against certain of its employees in connection with pos-
sible violations of law. The Company’s operating activities may also be negatively affected due
to imposed penalties, compensatory damages or due to the exclusion from public procure-
ment contracts. To date, no charges for any such penalties or damages have been accrued as
management does not yet have enough information to reasonably estimate such amounts.
Furthermore, changes affecting the Company’s course of business or its compliance programs
may turn out to be necessary.
34 Supplementary disclosures in accordance with Section 57 and 58 of the EGHGB in
conjunction with Par. 292a of the HGB (in the version effective until December 9, 2004)
In principle, the Company is required to prepare Consolidated Financial Statements in accor-
dance with German GAAP as stipulated in the German Commercial Code (HGB). However, as
stipulated in Section 57 and 58 of the EGHGB in conjunction with Par. 292a HGB, the Company
is exempt from preparing German GAAP Consolidated Financial Statements if the Company
prepares Consolidated Financial Statements in accordance with international accounting stan-
dards (such as U.S. GAAP) which are made available to the public (filing). The Company pre-
pares Consolidated Financial Statements in accordance with U.S. GAAP. Significant differences
between German GAAP and U.S. GAAP are described below.