Siemens 2012 Annual Report Download - page 242

1 A. To our Shareholders 49 C. Combined Management Report 21 B. Corporate Governance
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amendment is effective for reporting periods beginning on or
after January , . Both amendments have not yet been en-
dorsed by the European Union.
In June , the IASB issued IAS , Employee Benefits (revised
; IAS R). The Company expects the following amendments
to have a significant impact on the Company ’s Consolidated
Financial Statements: IAS R replaces the expected return on as-
sets and interest costs on the defined benefit obligation with a
single net interest component; unvested past service costs will be
recognized in income immediately when incurred. IAS R also
includes enhanced presentation and disclosure requirements.
The standard is effective for annual periods beginning on or after
January , ; early application is permitted. The amendment
has been endorsed by the European Union in June . The
Company will adopt the revised standard in fiscal . IAS R
requires retrospective application and the presentation of transi-
tion effects for the opening statement of financial position as of
October ,  for which Siemens does not expect significant
effects on the line items Total comprehensive income as well as
Total equity. For fiscal , expenses from pensions increase
approximately by € million pre-tax once IAS R is applied. For
fiscal  the expenses from pensions would approximately
be level to the adjusted expenses from pensions in fiscal .
In May , the IASB published its improvements to the ac-
counting and disclosure requirements for consolidation, off
balance sheet activities and joint arrangements by issuing IFRS
, Consolidated Financial Statements, IFRS , Joint Arrange-
ments, IFRS , Disclosure of Interests in Other Entities and
consequential amendments to IAS , Separate Financial State-
ments (amended ) and IAS , Investments in Associates
and Joint Ventures (amended ).
IFRS  builds on existing principles by identifying a compre-
hensive concept of control as the determining factor in whether
an entity should be included within the Consolidated Financial
Statements. The standard provides additional guidance to assist
in the determination of control where this is difficult to assess.
IFRS  provides guidance for the accounting of joint arrange-
ments by focusing on the rights and obligations of the arrange-
ment, rather than its legal form.
IFRS  is a new and comprehensive standard on disclosure re-
quirements for all forms of interests in other entities, includ-
ing joint arrangements, associates, structured entities and off
balance sheet vehicles.
IFRS , ,  and the consequential amendments to IAS 
and IAS  are effective for annual periods beginning on or af-
ter January , . These new or amended standards may be
adopted early, however all as of the same date, except that an
entity may early adopt the disclosure provisions of IFRS . The
standards are to be applied on a retrospective basis. IFRS , ,
, and the consequential amendments to IAS  and IAS 
are not endorsed by the European Union yet. Siemens will
adopt IFRS , , , and the consequential amendments to
IAS  and IAS  in fiscal . The Company does not expect
a material impact on its Consolidated Financial Statements
from these standards.
In May , the IASB issued IFRS , Fair Value Measurement.
The new standard defines fair value and standardizes disclo-
sures on fair value measurements of both financial and non-
financial instrument items. The new standard is applicable for
annual periods beginning on or after January , ; early
adoption is permitted. IFRS  is not endorsed by the European
Union yet. Siemens will adopt IFRS  in fiscal . Regarding
financial instruments, the majority of changes required by
IFRS  have already been introduced, mainly by amendments
to IFRS , Financial Instruments: Disclosures. The Company
does not expect a material impact on the Consolidated Finan-
cial Statements upon adopting IFRS .
In November , the IASB issued IFRS , Financial Instru-
ments. This standard is the first phase of the IASB’s three-phase
project to replace IAS , Financial Instruments: Recognition
and Measurement. IFRS  amends the classification and mea-
surement requirements for financial assets, including some hy-
brid contracts. It uses a single approach to determine whether a
financial asset is measured at amortized cost or at fair value, re-
placing the different rules in IAS . The approach in IFRS  is
based on how an entity manages its financial instruments (its
business model) and the contractual cash flow characteristics of
the financial assets. The new standard also requires a single im-
pairment method to be used, replacing the different impair-
ment methods in IAS . In December , the IASB deferred
the mandatory effective date from annual reporting periods be-
ginning on or after January ,  to annual reporting periods
beginning on or after January , ; early application is per-
mitted. The IASB also provided relief from restating comparative
financial statements for the effect of applying IFRS ; instead
additional transition disclosures will be required. The European
Financial Reporting Advisory Group postponed its endorsement
advice, to take more time to consider the output from the IASB
project to improve accounting for financial instruments. The
Company is currently assessing the impacts of adopting IFRS 
on the Company ’s Consolidated Financial Statements.
The IASB issued various other pronouncements. These recent-
ly adopted pronouncements as well as pronouncements not
yet adopted do not have a material impact on Siemens’ Consol-
idated Financial Statements.