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e following exchange rates were generally applied to foreign cur-
rency translation in the Group:
Foreign currency translation 2004 2005 2004 2005
€1 = Closing rates Average rates
USA USD 1.3612 1.1807 1.2433 1.24462
Switzerland CHF 1.5443 1.55563 1.5438 1.54842
United Kingdom GBP 0.709 0.68607 0.6785 0.68392
Sweden SEK 9.0041 9.39247 9.1253 9.28157
e carrying amounts of non-monetary assets recognized in the case
of consolidated companies operating in hyperinationary economies
are generally indexed in accordance with IAS 29 and thus reect the
current purchasing power at the balance sheet date.
In accordance with IAS 21, receivables and liabilities in the single-
entity nancial statements of consolidated companies that have been
prepared in local currencies are translated at the closing rate. Cur-
rency translation dierences are recognized in other operating in-
come and expenses in the income statement. In scal year 2005, other
operating income of €284 million (previous year: €88 million) and
other operating expenses of €220 million (previous year: €85 million)
resulted from currency translation dierences. In contrast, currency
translation dierences that relate to net investments in a foreign op-
eration are recognized in equity.
7 Accounting policies
e consolidated nancial statements were prepared on the basis
of historical costs, with the exception of available-for-sale nancial
assets as well as nancial assets and nancial liabilities at fair value
through prot or loss (especially derivative nancial instruments).
Revenue and expense recognition
Revenue and income from banking transactions, as well as other oper-
ating income, is generally recognized when services are rendered, the
amount of revenue and income can be reliably measured and it is
probable that the economic benets from the transactions will ow
to the Group.
Operating expenses are recognized when the service is utilized or
when the expenses are incurred.
Intangible assets
Purchased intangible assets are carried at cost. Internally generated
intangible assets are carried at cost if the criteria for recognition as
an asset are satised. is is the case in particular if future economic
benets are expected to ow from the assets. At Deutsche Post World
Net, these relate to internally developed soware. In addition to direct
costs, the production cost of internally developed soware includes
an appropriate share of attributable production overheads. Any bor-
rowing costs are not included in production costs. Value-added tax
arising in conjunction with the acquisition or production of intangi-
ble assets is included in the cost if it cannot be deducted as input tax.
Intangible assets are reduced by straight-line amortization over their
useful lives. Capitalized soware is amortized over two to six years,
licenses over the term of the license agreement. Intangible assets are
written down if there are indications of impairment and if the re-
coverable amount is lower than amortized cost. e write-downs are
reversed if the reasons for the impairment losses no longer apply.
Assets with an indenite useful life are not depreciated or amortized,
but are tested annually for impairment.
Since January 2005, goodwill has been accounted for using the “im-
pairment only approach” as dened by IFRS 3. is stipulates that
goodwill must subsequently be measured at cost less any cumulative
impairment. erefore, purchased goodwill may not be amortized;
rather, it must be tested for impairment annually in accordance with
IAS 36, irrespective of whether there are indications that it may be
impaired. Additionally, it remains the case that an impairment test
must be performed if there are indications of impairment.
For the purpose of the impairment test, goodwill is allocated to nine
cash-generating units (CGUs). e CGUs in scal year 2005 were as
follows:
Segment level
MAIL EXPRESS LOGISTICS FINANCIAL SERVICES
CGU level
Deutsche Post World Net Cash Generating Units (CGUs)
MAIL National EXPRESS Europe DHL Global Forwarding Financial Services
MAIL International EXPRESS Americas DHL EXEL Supply Chain
EXPRESS Asia Pacific
EXPRESS EMA
Annual Report 2005
96