Siemens 2013 Annual Report Download - page 177

253 D. Consolidated Financial Statements
357 E. Additional Information
245 C. Compensation Report, Corporate Governance
statement pursuant to Section a of the
German Commercial Code, Takeover-relevant
information and explanatory report
246 C. Siemens AG ( Discussion on basis of
German Commercial Code)
250 C. Notes and forward-looking statements

Year ended September ,
(in millions of €)  
Income from continuing operations before interest after tax
Net income 4,409 4,282
Plus/Less: Other interest expenses/income, net (455) (471)
Less/Plus: SFS Other interest expenses/income  556 462
Plus: Interest expenses from post-employment benefits 297 310
Less: Taxes on interest adjustments  (111) (91)
Income before interest after tax 4,695 4,493
Less/Plus: Income/loss from discontinued operations, net of income taxes (197) 360
Income from continuing operations before interest after tax 4,499 4,853
Return on capital employed (ROCE) (adjusted) (continuing and discontinued operations)
(I) Income before interest after tax 4,695 4,493
(II) Average capital employed (continuing and discontinued operations)  34,831 34,274
(I) / (II) ROCE (adjusted) (continuing and discontinued operations) 13.5% 13.1%
Return on capital employed (ROCE) (adjusted) (continuing operations)
(I) Income from continuing operations before interest after tax 4,499 4,853
(II) Average capital employed (continuing operations)  32,583 31,295
(I) / (II) ROCE (adjusted) (continuing operations) 13.8% 15.5%
1 SFS Other interest income/expenses is included in Other
interest income/expenses, net. Adding back SFS Other
interest income/expenses in the numerator corresponds
to the adjustment for SFS Debt in the denominator.
2 Effective tax rate for the determination of taxes on
interest adjustments is calculated by dividing Income
tax expenses through Income from continuing
operations before income taxes, both as reported
in D. CONSOLIDATED STATEMENTS OF INCOME.
3 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 €)  
Calculation of income taxes of SFS
Profit of SFS (Income before Income Taxes, IBIT) 409 479
Less/Plus: Income/loss from investments accounted for using the equity method, net of SFS  (85) (168)
Less/Plus: Tax-free income components and others  (26) 57
Tax basis 298 368
Tax rate (flat) 30% 30%
Calculated income taxes of SFS 89 110
Profit after tax of SFS
Profit of SFS (IBIT) 409 479
Less: Calculated income taxes of SFS (89) (110)
Profit after tax of SFS 320 368
ROE (after tax) of SFS
(I) Profit after tax of SFS 320 368
(II) Average allocated equity of SFS  1,874 1,681
(I) / (II) ROE (after tax) of SFS 17.1% 21.9%
1 For information on Income (loss) from investments
accounted for using the equity method, net of SFS,
see C.. RECONCILIATION TO ADJUSTED EBITDA
(CONTINUING OPERATIONS).
2 Tax-free income components include forms of financing
which are generally exempted from income taxes.
Others comprise result components related to the
(partial) sale/divestment of equity investments, which
are reclassified from at equity to available-for-sale
financial assets and are therefore not included in the
(Income) loss from investments accounted for using
the equity method, net of SFS. Such results are already
taxed or generally tax free. Others may also comprise
an adjustment for material taxable Income (loss) from
investments accounted for using the equity method,
net of SFS.
3 Average allocated equity of SFS for a fiscal year is deter-
mined as a five-point average in allocated equity of SFS
of the respective quarters starting with the allocated
equity of SFS as of September  of the previous fiscal
year.
C... RETURN ON EQUITY (ROE) (AFTER TAX)
The following table reports the calculation of ROE (after tax) of
SFS as defined under One Siemens.