Mercedes 2006 Annual Report Download - page 232

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Glossary
Code of Ethics. The DaimlerChrysler Code of Ethics applies to
the members of the Board of Management and persons who have
a significant responsibility for the contents of financial disclosure.
The regulations contained in the Code are designed to avoid mis-
conduct and to ensure ethical behavior and the correct disclosure
of information on the Group.
Compliance. Compliance means adhering not only to applicable
law, but also to the standards of ethical behavior as defined by
DaimlerChrysler and to the principles of corporate culture and
good business practice.
Consolidated Group. The consolidated Group is the total of all
those companies that are consolidated, i.e. fully consolidated
companies and companies consolidated using the equity method.
Corporate governance. The term corporate governance applies
to the proper management and monitoring of a company. The
structure of corporate governance at DaimlerChrysler AG is deter-
mined by Germany’s Stock Corporation Act, Codetermination
Act and capital-market legislation, as well as international capital-
market laws and stock-exchange listing regulations.
Cost of capital. The cost of capital is the product of the average
capital invested and the cost-of-capital rate. The cost-of-capital
rate is derived from the investors’ required rate of return (see
page 47).
CSR – corporate social responsibility. A collective term for the
social responsibility assumed by companies, including economic,
ecological and social aspects.
Equity method. Accounting and valuation method for share-
holdings in associated companies and joint ventures, as well
as subsidiaries that are not fully consolidated.
Fair value. The amount for which an asset or liability could be
exchanged in an arm’s length transaction between knowledge
able and willing parties who are independent of each other.
Goodwill. Goodwill is the term for the amount by which the price
paid for a company exceeds the value of the shareholders’
equity of that company when its assets and liabilities are valued
at current market value.
IFRS – International Financial Reporting Standards. IFRS are
a set of standards and interpretations for companies’ financial
accounting and reporting developed by an independent private-
sector committee, the International Accounting Standards
Board (IASB). DaimlerChrysler will prepare and disclose its first
consolidated financial statements according to IFRS for financial
year 2006 (see page 211).
Integrity Code. Our Integrity Code has been in use since 1999
and was revised and expanded in 2003. It sets out a binding
framework for the actions of all our employees worldwide.
Net assets. Net assets represent the capital employed by the
Group and the industrial divisions. The relevant capital basis for
Financial Services is equity capital (see page 47).
Net operating income.
Net operating income is the operational
profit measure after taxes and the relevant parameter for mea-
suring the Group’s operating performance.
Operating profit. Operating profit is the operational profit
measure before taxes (see page 43).
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