Nokia 2006 Annual Report Download - page 157

Notes to the Consolidated Financial Statements (Continued)
1. Accounting principles (Continued)
)IFRS 7, Financial Instruments: Disclosures, includes a comprehensive set of qualitative and
quantitative disclosures on risk exposures from all financial instruments. The Group will adopt
IFRS 7 on January 1, 2007 and does not expect the adoption of this standard to have a
material impact on the disclosures.
)IFRS 8, Operating Segments requires that segments are identified and reported based on a
risk and return analysis. Under IFRS 8, segments are components of an entity regularly
reviewed by an entity’s chief operating decisionmaker. Given the delayed implementation
date for this standard, it has not been practicable to evaluate the impact of this standard.
2. Segment information
Nokia is organized on a worldwide basis into four primary business segments: Mobile Phones,
Multimedia, Enterprise Solutions and Networks. Nokia’s reportable segments represent the strategic
business units that offer different products and services for which monthly financial information is
provided to the Board.
Mobile Phones connects people by providing expanding mobile voice and data capabilities across a
wide range of mobile devices.
Multimedia gives people the ability to create, access, experience and share multimedia in the form of
advanced mobile multimedia computers and applications with connectivity over multiple technology
standards.
Enterprise Solutions offers businesses and institutions a broad range of products and solutions,
including enterprisegrade mobile devices, underlying security infrastructure, software and services.
Networks provides network infrastructure, communications and networks service platforms, as well
as professional services to operators and service providers.
In addition to the four business groups, the Group’s organization has two horizontal units to support
the mobile device business groups, increase operational efficiency and competitiveness, and to take
advantage of economies of scale: Customer and Market Operations and Technology Platforms. The
horizontal groups are not separate reporting entities, but their costs are carried mainly by the
mobile device business groups, which comprises of Mobile Phones, Multimedia and Enterprise
Solutions, with the balance included in Common Group Functions. The costs and revenues as well as
assets and liabilities of the horizontal groups are allocated to the mobile device business groups on
a symmetrical basis; with amounts not allocated included in Common Group Functions. Common
Group Functions comprising of common research and general Group functions.
The accounting policies of the segments are the same as those described in Note 1. Nokia accounts
for intersegment revenues and transfers as if the revenues or transfers were to third parties, that is,
at current market prices. Nokia evaluates the performance of its segments and allocates resources to
them based on operating profit.
F22