Siemens 2012 Annual Report Download - page 245

135 D. Consolidated Financial Statements 239 E. Additional Information
140 D. Consolidated Statements of Changes in Equity
142 D. Notes to Consolidated Financial Statements
232 D. Supervisory Board and Managing Board
136 D. Consolidated Statements of Income
137 D. Consolidated Statements of Comprehensive Income
138 D. Consolidated Statements of Financial Position
139 D. Consolidated Statements of Cash Flow
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decommissioning because of the long time frame over which
future cash outflows are expected to occur including the re-
spective interest accretion. Amongst others, the estimated
cash outflows could alter significantly if, and when, political
developments affect the government’s plans to develop the
final storage.
Siemens is subject to legal and regulatory proceedings in vari-
ous jurisdictions. Such proceedings may result in criminal or civ-
il sanctions, penalties or disgorgements against the Company.
If it is more likely than not that an obligation of the Company
exists and will result in an outflow of resources, a provision is
recorded if the amount of the obligation can be reliably estimat-
ed. Regulatory and legal proceedings as well as government in-
vestigations often involve complex legal issues and are subject
to substantial uncertainties. Accordingly, management exercis-
es considerable judgment in determining whether there is a
present obligation as a result of a past event at the end of the re-
porting period, whether it is more likely than not that such a
proceeding will result in an outflow of resources and whether
the amount of the obligation can be reliably estimated. The
Company periodically reviews the status of these proceedings
with both inside and outside counsel. These judgments are sub-
ject to change as new information becomes available. The re-
quired amount of a provision may change in the future due to
new developments in the particular matter. Revisions to esti-
mates may significantly impact future net income. Upon resolu-
tion, Siemens may incur charges in excess of the recorded pro-
visions for such matters. It cannot be excluded, that the finan-
cial position or results of operations of Siemens will be materi-
ally affected by an unfavorable outcome of legal or regulatory
proceedings or government investigations.
Income taxes – Siemens operates in various tax jurisdictions
and therefore has to determine tax positions under respective
local tax laws and tax authorities’ views which can be complex
and subject to different interpretations of taxpayers and local
tax authorities. Deferred tax assets are recognized if sufficient
future taxable profit is available, including income from fore-
casted operating earnings, the reversal of existing taxable
temporary differences and established tax planning opportuni-
ties. As of each period-end, management evaluates the recov-
erability of deferred tax assets, based on projected future tax-
able profits. As future developments are uncertain and partly
beyond management’s control, assumptions are necessary to
estimate future taxable profits as well as the period in which
deferred tax assets will recover. Estimates are revised in the
period in which there is sufficient evidence to revise the as-
sumption. If management considers it probable that all or a
portion of a deferred tax asset cannot be realized, a corre-
sponding valuation allowance is taken into account.
  Acquisitions, dispositions
and discontinued operations
) 
In fiscal  and , the Company completed a number of
acquisitions, which are included in the Company ’s Consolidat-
ed Financial Statements since the date of acquisition.
aa) Acquisitions in fiscal 
At the beginning of May , Siemens acquired all of the
shares of five entities constituting the Connectors and Mea-
surements division of Expro Holdings UK  Ltd. The acquired
business engineers and manufactures subsea components
such as cable connectors, sensors and measuring devices.
With this acquisition Siemens aimed for strategically expand-
ing its portfolio in the attractive future market for subsea pow-
er grids. The aggregate consideration amounts to € million
(including € million cash acquired). The acquired business
will be integrated into Energy Sector’s Oil & Gas Division. The
following figures represent the preliminary purchase price al-
location and show the amounts recognized as of the acquisi-
tion date for each major class of assets acquired and liabilities
assumed: Intangible assets € million, Property, plant and
equipment € million, Inventories € million, Receivables
€ million, Liabilities € million and Deferred income tax li-
abilities € million. Intangible assets mainly relate to custom-
er relationships of € million with useful lives from nine to 
years, technology of € million with a useful life of eight to
twelve years and order backlog of € million with a useful life
of two years. Goodwill of € million comprises intangible as-
sets that are not separable such as employee know-how and
expected synergy effects. Including effects from purchase ac-
counting and integration costs, the acquired business contrib-
uted revenues of € million and a net profit of € million to
Siemens for the period from acquisition to September , .
If the acquired business had been included as of October ,
, the impact on consolidated revenues and consolidated
net income for the twelve months ended September , 
would have been € million and € million, respectively.
Furthermore, in fiscal , Siemens completed the acquisition
of a number of entities, presented in continuing operations,
which are not significant individually including RuggedCom
Inc., a provider of robust, industrial-quality Ethernet communi-
cation products and network solutions at the Industry Sector’s
Industry Automation Division, the NEM B.V. business, a special-
ist in heat recovery steam generators for combined-cycle (gas
and steam) power plants at Energy Sector’s Fossil Power Gener-
ation Division and eMeter Corporation, a meter data manage-
ment specialist at Infrastructure & Cities Sector’s Smart Grid
Division. The aggregate consideration (including cash acquired)
of all of these acquisitions amounts to € million.