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Annual Report 2006 31
Consolidation scope
The consolidated financial statements of Mondial Assistance Group comprise the annual
accounts of Mondial Assistance AG and subsidiaries, which are prepared in accordance with
the accounting and valuation principles of the Mondial Assistance Group. Consolidated
subsidiaries are listed further in the notes to the consolidated financial statements.
The holding company SACNAS International S.A., France, merged with Mondial Assistance
S.A.S, France. Mondial Assistance France S.A.S was incorporated with the purpose of service
and brokerage.
The Japanese company AS24 (NIJUYKON K.K.) has been renamed to Millea Mondial Co Ltd,
Tokyo, and the group’s participation reduced to 50%.
In Brazil, the broker company Mondial Protection Corretora de Seguros Ltda was founded.
Consolidation principles
Subsidiaries have been recorded according to the full consolidation method when subject to
the majority control of the Mondial Assistance Group.
All intra-group transactions and balances have been eliminated.
Interests in joint ventures are recognised by including the accounts using the proportionate
consolidation basis, i.e. by including in the accounts under the appropriate financial statement
headings the Group’s proportion of the joint venture revenues, costs, assets and liabilities.
Equity investments in which the Mondial Assistance Group owns at least 20% of the voting
rights are accounted for using the equity method, except for investments in which the Mondial
Assistance Group is not able to exercise significant influence, in which case, the cost method
is used.
Investments in which the company owns less than 20% are accounted for under the cost
method.
The equity and net income attributable to minority shareholders’ interests are disclosed separately
in the balance sheet and income statement respectively.
The purchase method of accounting is used for acquired businesses. Companies acquired
or disposed of during the year are included in the consolidated financial statements from the
date of acquisition or to the date of disposal respectively.
Foreign currency translation
The Group’s reporting currency is the Euro (€). The functional currency for each Group company
is the currency of the environment where the enterprise carries on its activities. Assets and
liabilities are translated at the closing rate on the balance sheet date. Expenses and income
are translated at the annual average rate from the functional currency into the reporting currency.
Translation differences between the functional currency and reporting currency, including those
arising in the process of equity consolidation, are taken to shareholders’ equity without affecting
earnings. Translation differences between the transaction currency and functional currency
are reported in earnings.
Exchange rates of principal currencies
Balance sheet year end rate
(against 1 euro) 2006 2005
Australia (AUD) 1.6691 1.6109
Japan (JPY) 156.9300 138.9000
Brazil (BRL) 2.8133 2.7515
United Kingdom (GBP) 0.6715 0.6853
Switzerland (CHF) 1.6069 1.5551
USA (USD) 1.3170 1.1797
Income statement average rate
(against 1 euro) 2006 2005
Australia (AUD) 1.6669 1.6322
Japan (JPY) 146.0642 136.8628
Brazil (BRL) 2.7327 2.8979
United Kingdom (GBP) 0.6818 0.6839
Switzerland (CHF) 1.5731 1.5482
USA (USD) 1.2557 1.2443
Notes to the consolidated financial
statements of Mondial Assistance Group
Notes to the consolidated
financial statements