Siemens 2011 Annual Report Download - page 379

153 D. Consolidated Financial Statements 273 E. Additional information
274 E. Statement of the Managing Board
274 E. Responsibility statement
275 E. Independent Auditors’ report
276 E. Five-year summary
278 E. Glossary
281 E. Index
283 E. Information resources / Further information
285 E. Company structure
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E
Emerging market economies Economies that do not form part of the industrialized economies. Siemens defines emerging market countries by
means of a negative delimitation from developed economies in accordance with the definition by the International
Monetary Fund (IMF).
Equity method A method under which associates are accounted for in the Consolidated Financial Statements.
Expected return on plan assets An estimation of expected return derived from pension plan assets at the beginning of fiscal year.
F
Fair value The amount at which an asset could be exchanged, or a liability settled, between knowledgeable willing parties
in an arm’s length transaction.
Free cash flow A measure of operative cash generation. Siemens defines “Free cash flow” as inflows and outflows of cash and
cash equivalents provided by (used in) operating activities less cash outflows for additions to intangible assets
and property, plant and equipment.
Functional costs Functional costs comprise “Cost of goods sold and services rendered,” “Research and development expenses,”
and “Marketing, selling and general administrative expenses.”
Funded status of pension plan The difference between a pension plan’s defined benefit obligation (DBO) and the fair market value of assets
designated to the pension plan (plan assets) as of a specific date.
G
German Corporate Governance Code Essential statutory regulations for the management and supervision of German listed companies. It contains
internationally and nationally recognized standards for good and responsible governance.
Common stock A part of equity, representing the amount to which the shareholders’ liability is limited (also referred to as share
capital).
Goodwill Excess of the purchase price over the fair market value of the net assets acquired.
H
Hedge accounting Accounting method related to hedging of cash flows or fair values of assets and liabilities by using
hedging instruments.
HGB Abbreviation for German Commercial Code (HGB). Forms the basis of the accounting concepts, measurement
techniques and standards of presentation used in financial statements in Germany.
Hybrid bond A corporate bond that, due to its characteristics such as long maturity date and subordination, bears the character
of both debt and equity.
I
IFRS Abbreviation for International Financial Reporting Standards (IFRS), previously International Accounting Standards
(IAS). According to the IAS regulation endorsed by the European Union, publicly traded companies in the European
Union are required to prepare their consolidated financial statements in accordance with IFRS.
J
Joint venture A contractual arrangement whereby two or more parties undertake an economic activity that is subject to
joint control.
L
Lease A contract under which one party, the lessor (owner) of an asset, agrees to grant the use of that asset to another,
the lessee, in exchange for periodic rental payments.