Porsche 2006 Annual Report Download - page 173

171
(35) Segment reporting
The objective of the segment reporting is to provide information about the main divisions of the Group.
In accordance with IAS 14, the Group’s activities are broken down by region as the primary reporting
format and by business division as the secondary reporting format. Segmentation is based on the internal
reporting and organizational structure, taking account of the different risk and income structures of the
various regions and divisions. The segmentation by region is based on the location of the customers.
According to the different risk and income structure, the Group is divided into the regions Germany,
North America, Europe without Germany and rest of the world.
Segmentation by business division shows the vehicles and financial services divisions. The vehicles
division includes the development, production and sale of vehicles as well as related services.
The financial services division comprises the financing and leasing business for customers and dealers.
Intersegment receivables and liabilities, provisions, income and expenses as well as profits and losses
are eliminated in the column “consolidation”. This column also includes the items not allocable to the
individual segments. The segment figures are determined in accordance with the recognition and measure-
ment methods used in the consolidated financial statements. The business relations between the entities
of the Porsche Group are generally based on prices as agreed with third parties.
Third-party sales show the share of each division in the Porsche Group’s sales revenues.
Intersegment sales shows the sales effected between the segments.
Profits before financial income and income tax constitutes the segment result from continuing operations.
The segment result includes the result from lease transactions as well as the result from customer and
dealer financing.
Segment assets include all assets except for income tax claims and assets allocable to financial transactions.
Segment liabilities include all liabilities except for income tax liabilities and financial liabilities unless they
were incurred directly for operating purposes.
Non-cash expenses mainly include additions to provisions and unrealized losses from measurement
at market value.
Amortization and depreciation as well as capital expenditures primarily relate to property, plant and
equipment, intangible assets and leased assets.
In the previous year, financial derivatives were not allocated to the segment assets and segment liabilities.
In disclosing the segment liabilities the company also excluded financial liabilities whose profit share
was not allocated to the segment result. The shares measured at equity were also not allocated to a single
segment because they are not clearly allocable. This was adjusted accordingly for the segments concerned
in the primary and secondary segment report. Due to the adjustment made in the previous year to the
disclosure of minority interests, the “Consolidation” column also contains the effects from this adjustment.