DHL 2005 Annual Report Download - page 99

IAS 32 (Revised 2004): Financial Instruments: Disclosure
and Presentation and IAS 39 (Revised 2004): Financial
Instruments: Recognition and Measurement
e retrospective initial application of the more detailed accounting
treatment for impairment losses on equities set out by IAS 39.61 en-
tailed the recognition of cumulative impairment losses on equities to-
taling €430 million for scal year 2004, which resulted in a reduction
in retained earnings and an increase in the IAS 39 reserve (revalua-
tion reserve). e reclassication of nancial assets at the Deutsche
Postbank group also reduces the revaluation reserve by €29 million
and minority interest by €15 million.
IFRS 3: Business Combinations/IAS 36 (Revised 2004): Im-
pairment of Assets/IAS 38 (Revised 2004): Intangible Assets
Following the application of IFRS 3 Business Combinations, goodwill
has not been amortized for new acquisitions since April 1, 2004, and
for earlier acquisitions recognized in subsequent periods since Janu-
ary 1, 2005. Goodwill previously amortized by the Group will only be
written down if an impairment test in accordance with IAS 36 con-
rms that it is impaired. In addition, the Group reassessed the useful
lives of its intangible assets in accordance with IAS 38. is did not
lead to any restatements.
Following the application of IFRS 3, the income statement no longer
contains the goodwill amortization and prot or loss from operating
activities before goodwill amortization (EBITA) items. e amount of
€370 million reported under goodwill amortization in the previous
year was reclassied to depreciation, amortization and impairment
losses.
Change in an accounting policy: restatement of prior-year
amounts in accordance with IAS 8.22
e Deutsche Postbank group has changed an accounting policy;
from scal year 2005, the deferral of expenses relating to sales ac-
tivities for mortgage loans is spread over the term of the loans. is
change to reect IAS 8.22 was also applied to prior years. e deferral
is presented under receivables and other assets in prepaid expenses.
Restatements in the income statement
To take account of the Group’s strong growth, its international posi-
tioning as well as increasing information requirements, a unied
chart of accounts was drawn up in scal year 2005 which is binding
on all subsidiaries. e chart of accounts complies with the IFRS re-
quirements and allows a more transparent presentation of our com-
panies’ operating activities. e prior-period amounts were restated
where required. Especially in the income statement reclassications
were necessary between individual items, e.g. the reclassication of
rental and lease expenses from other operating expenses to materials
expense and expenses from banking transactions, as well as within
individual items.
Restated income statement Dec. 31, 2004 Dec. 31, 2004 +/–
€m restated
Materials expense and expenses
from banking transactions1) –20,546 –21,915 –1,369
Staff costs1) –13,744 –13,840 –96
Depreciation, amortization and
impairment losses2) –1,451 –1,821 –370
Other operating expenses1), 3) –5,445 –3,956 1,489
Income tax expense3) –431 –440 –9
Consolidated net profit for the year3) 1,725 1,740 15
Deutsche Post AG shareholders3) 1,588 1,598 10
Minorities3) 137 142 5
1) Prior-period amounts restated due to new chart of accounts.
2) IFRS 3
3) IAS 8.22
6 Currency translation
e nancial statements of consolidated companies prepared in for-
eign currencies are translated into euros (€) in accordance with IAS 21
using the functional currency method. e functional currency of
foreign companies is determined by the primary economic environ-
ment in which they mainly generate and use cash. Within Deutsche
Post World Net, the functional currency is predominantly the local
currency. In the consolidated nancial statements, assets and liabili-
ties are therefore translated at the closing rates, while income and
expenses are generally translated at the monthly closing rates. e
resulting currency translation dierences are taken directly to equity.
Currency translation dierences of €108 million (previous year: €28
million) were recognized directly in equity in scal year 2005 (see
also the statement of changes in equity).
Goodwill resulting from the use of acquisition accounting for for-
eign companies is translated at the rates prevailing at the transaction
dates.
Deutsche Post World Net
95
Notes
Consolidated Financial StatementsAdditional Information