Chrysler 2009 Annual Report Download - page 134

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Investments in other companies
Investments in other companies that are available-for-sale financial assets are measured at fair value, when this can be reliably
determined. Gains or losses arising from changes in fair value are recognised directly in equity until the assets are sold or are
impaired, when the cumulative gains and losses previously recognised in equity are recognised in the income statement of
the period.
Investments in other companies for which fair value is not available are stated at cost less any impairment losses.
Dividends received from these investments are included in Other income (expenses) from investments.
Transactions eliminated on consolidation
All significant intragroup balances and transactions and any unrealised gains and losses arising from intragroup transactions
are eliminated in preparing the consolidated financial statements. Unrealised gains and losses arising from transactions with
associates and jointly controlled entities are eliminated to the extent of the Group’s interest in those entities.
Foreign currency transactions
Transactions in foreign currencies are recorded at the foreign exchange rate prevailing at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the exchange rate prevailing
at that date. Exchange differences arising on the settlement of monetary items or on reporting monetary items at rates different
from those at which they were initially recorded during the period or in previous financial statements, are recognised in the income
statement.
Consolidation of foreign entities
All assets and liabilities of foreign consolidated companies with a functional currency other than the Euro are translated using
the exchange rates in effect at the balance sheet date. Income and expenses are translated at the average exchange rate for
the period. Translation differences resulting from the application of this method are classified as equity until the disposal of the
investment. Average rates of exchange are used to translate the cash flows of foreign subsidiaries in preparing the consolidated
statement of cash flows.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are recorded in the relevant functional currency
of the foreign entity and are translated using the period end exchange rate.
The principal exchange rates used in 2009 and 2008 to translate into Euros the financial statements prepared in currencies
other than the euros were as follows:
Average 2009 At 31 December 2009 Average 2008 At 31 December 2008
U.S. dollar 1.395 1.441 1.471 1.392
Pound sterling 0.891 0.888 0.796 0.953
Swiss franc 1.510 1.484 1.587 1.485
Polish zloty 4.328 4.105 3.512 4.154
Brazilian real 2.767 2.511 2.674 3.244
Argentine peso 5.201 5.473 4.679 4.800
In the context of IFRS First-time Adoption, the cumulative translation difference arising from the consolidation of foreign
operations outside the Euro zone was set at nil, as permitted by IFRS 1; gains or losses on subsequent disposal of any foreign
operation only include accumulated translation differences arising after 1 January 2004.