Nokia 2006 Annual Report Download - page 198
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Notes to the Consolidated Financial Statements (Continued)
37. Risk management (Continued)
Fair values of derivatives
The net fair values of derivative financial instruments at the balance sheet date were:
2006 2005
EURm EURm
Derivatives with positive fair value(1):
Forward foreign exchange contracts(2) ****************************************** 65 60
Currency options ************************************************************* 21
Cash settled equity options**************************************************** 78
Derivatives with negative fair value(1):
Forward foreign exchange contracts(2) ****************************************** (63) (97)
Currency options ************************************************************* (3) —
Cash settled equity options**************************************************** (2) —
(1) Out of the forward foreign exchange contracts and currency options, fair value net EUR 25 million
gain was designated for hedges of net investment in foreign subsidiaries as at December 31, 2006
(net EUR 27 million loss at December 31, 2005) and reported within translation differences.
(2) Out of the outstanding foreign exchange forward contracts, fair value net EUR 1 million loss was
designated for cash flow hedges as at December 31, 2006 (net EUR 3 million loss at December 31,
2005) and reported in fair value and other reserves. The total gain and loss of foreign exchange
forward contracts designated for cash flow hedges and reported in fair value and other reserves
was net EUR 69 million gain as at December 31, 2006 (net EUR 163 million loss at December 31,
2005).
38. Differences between International Financial Reporting Standards and US Generally
Accepted Accounting Principles
The Group’s consolidated financial statements are prepared in accordance with International
Financial Reporting Standards, which differ in certain respects from accounting principles generally
accepted in the United States of America (US GAAP). The principal differences between IFRS and
US GAAP are presented below together with explanations of certain adjustments that affect
F63