Siemens 2007 Annual Report Download - page 310

310 Notes to Consolidated Financial Statements
(in millions of €, except where otherwise stated and per share amounts)
The Managing Board also determined net capital employed as additional infor-
mation to assess the capital intensity of the Operations Groups. Its defi nition cor-
responds with the Group profi t measure. Net capital employed is based on total
assets excluding intragroup fi nancing receivables and intragroup investments
and tax related assets, as the corresponding positions are excluded from Group
profi t (asset-based adjustments). The remaining assets are reduced by non-inter-
est-bearing liabilities other than tax related liabilities (e.g. trade payables) and
provisions (liability-based adjustments) to derive net capital employed. The recon-
ciliation of total assets to net capital employed is presented below.
Other Operations primarily refers to operating activities not associated with a
Group, as well as to assets recently acquired as part of acquisitions for which the
allocation to the Groups are not yet fi nalized but excluding the investment in Infi -
neon, which was included in Corporate items prior to its sale (see Note 10 for fur-
ther information). The Dematic business was included in Other Operations before
a signifi cant portion of it was sold (see Note 4 for further information).
Reconciliation to fi nancial statements
Reconciliation to fi nancial statements includes items which are excluded from the
defi nition of Group profi t as well as costs of corporate headquarters.
Corporate items includes corporate charges such as personnel costs for corpo-
rate headquarters, the results of corporate-related derivative activities, as well as
corporate projects and non-operating investments. Pensions includes the Compa-
ny’s pension related income (expenses) not allocated to the Groups. Eliminations
represents the consolidation of transactions within the Operations component.
In fi scal 2007, Corporate items, pensions and eliminations in the column Group
profi t includes €(1,728) related to corporate items, as well as €70 and €(14) related
to pensions and eliminations, respectively. Included in €(1,728) above is a €(440)
total impact related to a fi ne imposed by the European Commission in connection
with an antitrust investigation involving suppliers of high-voltage gas-isolated
switching systems in the power transmission and distribution industry between
1988 and 2004 (see Notes 6 and 29 for further information). In addition, €(1,728)
also includes €(152) for outside advisors engaged by the Company in connection
with investigations into alleged violations of anti-corruption laws and related
matters as well as remediation activities (see Notes 6 and 29 for additional infor-
mation), as well as €(106) impairment related to Siemens’ regional sales organiza-
tion in Germany. In fi scal 2006, Corporate items, pensions and eliminations in the
column Group profi t includes €(553) related to corporate items, as well as €26 and
€– related to pensions and eliminations, respectively. In fi scal 2006, Corporate
items includes pre-tax gains of €33 and €15, respectively, from the sale of the
Company’s remaining interest in Infi neon and Epcos (see Note 10).
Other interest expense of Operations relates primarily to interest paid on debt
and corporate fi nancing transactions through Corporate Treasury.