Siemens 2007 Annual Report Download - page 327

Glossary 327
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Free cash fl ow A measure of operative cash generation. It represents net cash provided by (used in) operating activities
less cash used for additions to intangible assets and property, plant and equipment.
Financing and Real Estate The worldwide leasing, lending, fi nancing and real estate activities of Siemens Financial Services (SFS) and
Siemens Real Estate (SRE).
Fully diluted Earnings per share are fully diluted when they refl ect the effects of an assumed conversion or the exercise
of all potentially dilutive securities or stock options.
Functional costs Functional costs include cost of sales, R&D expenses, marketing and selling expenses, and general
administration expenses.
Funded status of pension plan The difference between a pension plan’s projected benefi t obligation (PBO) and the fair market value of
assets designated to the pension plan (plan assets) as of a specifi c date.
GASC Short for “German Accounting Standards Committee.” An independent registered association to develop,
among other things, accounting standards for application in the area of consolidated fi nancial reporting.
German GAAP Short for “Generally Accepted Accounting Principles in Germany.” The accounting concepts, measurements,
techniques and standards of presentation used in fi nancial statements in Germany pursuant to the German
Commercial Code (HGB).
Goodwill The excess of cost of an acquired entity over the amounts assigned to assets acquired and liabilities
assumed.
Group profi t Measure of Group profi tability, defi ned as earnings before fi nancing interest, certain pension costs and
income taxes.
Hedging A strategy used to minimize exposure to changes in prices, interest rates or exchange rates by means of
derivative fi nancial instruments (options, swaps, forward contracts, etc.).
Hybrid bond A hybrid bond is a bond that due to its subordination bears the character of both debt and equity.
IFRS Short for “International Financial Reporting Standards,” previously “International Accounting Standards”
(IAS). According to IAS Regulation of the European Union, publicly traded European Union companies are
required to prepare their consolidated fi nancial statements in accordance with IFRS beginning January
2005 and/or January 2007 at the latest.
Joint venture A form of business partnership between two or more companies to engage in a commercial enterprise with
mutual sharing of profi ts and losses.
Medium-term note program Flexible fi nancing framework providing for the issuance of notes in rotation in the context of a program
unrestricted in time (constant issue). The notes may be issued in several tranches, with terms and con-
ditions and time of issue being determined in accordance with then current goals and prevailing market
conditions.
Moody’s Investors Service Independent rating agency that assesses securities investment and credit risk.
Net capital employed Net capital employed is the asset measure used to assess the capital intensity of Operations. Its defi nition
corresponds with the Group profi t measure.
Net cash from operating Total of cash provided by (used in) operating and investing activities as determined in the Statements
and investing activities of Cash Flow.
Net periodic pension cost The amount of pension costs recorded in the Statements of Income. Net periodic pension cost components
include service cost, interest cost, expected return on plan assets, amortization of unrecognized prior
service cost (if any), gains or losses recognized and amortized after exceeding a certain corridor (if any),
amortization of unrecognized initial net obligation and/or initial net asset.