ING Direct 2009 Annual Report Download - page 114

The statement of cash flows has been drawn up in accordance with the indirect method, classifying cash flows as cash flows from
operating, investing and financing activities. In the net cash flow from operating activities, the result before tax is adjusted for those items
in the profit and loss account, and changes in balance sheet items, which do not result in actual cash flows during the year.
For the purposes of the statement of cash flows, Cash and cash equivalents comprise balances with less than three months’ maturity from
the date of acquisition, including cash and non-restricted balances with central banks, treasury bills and other eligible bills, amounts due
from other banks and amounts due to banks. Investments qualify as a cash equivalent if they are readily convertible to a known amount of
cash and are subject to an insignificant risk of changes in value.
Cash flows arising from foreign currency transactions are translated into the functional currency using the exchange rates at the date of
the cash flows.
The net cash flow shown in respect of Loans and advances to customers relates only to transactions involving actual payments or receipts.
The Addition to loan loss provision which is deducted from the item Loans and advances to customers in the balance sheet has been
adjusted accordingly from the result before tax and is shown separately in the statement of cash flows.
The difference between the net cash flow in accordance with the statement of cash flows and the change in Cash and cash equivalents in
the balance sheet is due to exchange rate differences and is accounted for separately as part of the reconciliation of the net cash flow and
the balance sheet change in Cash and cash equivalents.
2.1 Consolidated annual accounts
ING Group Annual Report 2009
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Accounting policies for the consolidated statement
of cash flows of ING Group