[6] Currency translation

Financial statements in foreign currencies are translated in accordance with the functional currency concept (IAS 21 ‘The Effects of Changes in Foreign Exchange Rates’). The functional currency is the currency of the primary economic environment in which an entity operates. The modified closing-rate method is used for currency translation.

The assets and liabilities of foreign subsidiaries, including goodwill, are translated at the middle spot exchange rate, i.e. at the average of the bid or offer rates on the reporting date. Income and expenses are translated at the average rate. With the exception of income and expenses recognised as other comprehensive income (loss), equity is recognised at historical rates. The resulting translation differences are not taken to income and are recognised in other comprehensive income (loss) until subsidiaries are disposed of.

The financial statements of foreign equity-accounted investments are also translated using the method described above.

Transactions of the consolidated entities in foreign currencies are translated into the relevant company’s functional currency at the rate prevailing on the transaction date. On the reporting date, monetary items are translated at the closing rate and non-monetary items at the rate prevailing on the transaction date. Currency translation differences are taken to income and recognised in other income / expenses or in net financial income / expenses.

The translation rates were used for currencies that are material to the financial statements. > TABLE 044

Major foreign currency rates in €

044

 

Average rate

Closing rate

2015

2014

2015

2014

Australia (AUD)

1.4784

1.4727

1.4876

1.4809

Brazil (BRL)

3.7006

3.1209

4.3007

3.2152

Switzerland (CHF)

1.0686

1.2147

1.0872

1.2029

China (CNY)

6.9767

8.1914

7.0914

7.5085

United Kingdom (GBP)

0.7264

0.8064

0.7375

0.7768

Russia (RUB)

68.0183

50.9191

79.8372

70.2294

U.S.A. (USD)

1.1103

1.3294

1.0857

1.2099