Siemens 2012 Annual Report Download - page 157

135 D. Consolidated Financial Statements
239 E. Additional Information
130 C. Siemens AG (Discussion on basis of
German Commercial Code)
134 C. Notes and forward-looking statements
129 C. Compensation Report, Corporate Governance
statement pursuant to Section a of the
German Commercial Code, Takeover-relevant
information and explanatory report

(in millions of €) // // // // //
Capital employed Fiscal 
Total equity 32,156 31,542 31,483 32,057 29,096
Plus: Long-term debt 14,280 14,191 14,196 15,656 17,497
Plus: Short-term debt and current maturities of long-term debt 3,660 4,971 5,016 4,051 2,416
Less: Cash and cash equivalents (12,468) (13,006) (14,973) (15,662) (14,108)
Plus: Pension plans and similar commitments 7,307 5,997 5,845 7,234 8,464
Less: SFS Debt (12,075) (10,384) (10,037) (9,925) (10,028)
Less: Fair value hedge accounting adjustment (1,470) (808) (719) (1,037) (1,518)
Capital employed (continuing operations and discontinued operations) 231,391 32,503 30,812 32,374 31,819
Less: Assets classified as held for disposal presented as discontinued operations (4,667) (5,636) (5,148) – –
Plus: Liabilities classified as held for disposal presented as discontinued operations 1,756 3,121 2,966 – –
Capital employed (continuing operations) 228,479 29,987 28,630 32,374 31,819
1 Debt is generally reported with a value representing approximately the amount to
be repaid. However for debt designated in a hedging relationship (fair value hedges),
this amount is adjusted by changes in market value mainly due to changes in interest
rates. Accordingly, we deduct these changes in market value in order to end up with
an amount of debt that approximately will be repaid, which we believe is a more mean-
ingful figure for the calculation presented above. For further information on fair value
hedges see    .     .
 Average capital employed for a fiscal year is determined as a five-point average in
capital employed of the respective quarters starting with the capital employed as of
September  of the previous fiscal year.
Year ended September ,
(in millions of €)  
Income from continuing operations before interest after tax
Net income 4,590 6,321
Less/Plus: Other interest expense/income, net (471) (376)
Less/Plus: SFS Other interest expense/income  462 371
Plus: Interest cost on Pension plans and similar commitments  333 356
Less: Taxes on interest adjustments (93) (81)
Income before interest after tax 4,821 6,590
Less/Plus: Income/loss from discontinued operations, net of income taxes 595 1,055
Income from continuing operations before interest after tax 5,416 7,645
Return on capital employed (ROCE) (adjusted) (continuing operations)
(I) Income from continuing operations before interest after tax 5,416 7,645
(II) Average capital employed (continuing operations) 31,816 30,258
(I) / (II) ROCE (adjusted) (continuing operations) 17.0% 25.3%
1 SFS Other interest income/expense is included in Other interest income/expense, net.
Adding back SFS Other interest income/expense in the numerator corresponds to the
adjustment for SFS Debt in the denominator.
2 For fiscal  and , interest cost on Pension plans and similar commitments is
calculated using the weighted average discount rate of our pension benefit plans
for the fiscal year ended September ,  (.%) and September ,  (.%)
(both as reported in Notes to Consolidated Financial Statements) applied to Pension
plans and similar commitments as reported in the Consolidated Statements of Financial
Position as of September ,  and , respectively.
3 Effective tax rate for the determination of taxes on interest adjustments is calculated by
dividing Income taxes through Income from continuing operations before income taxes,
both as reported in .    .