ANNUAL REPORT 2009 - GAM Holding AG

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GAM Holding Ltd., formerly Julius Baer Holding Ltd., is a Swiss corporation. The consolidated financial statements as of 31 December 2009
comprise those of GAM Holding Ltd. and all its subsidiaries. The Board of Directors approved these financial statements on 26 February 2010.
In addition, they must be approved by the Ordinary Annual General Meeting on 13 April 2010.
Amounts in the annual financial statements are stated in Swiss francs. The consolidated financial statements are prepared in accordance with
the International Financial Reporting Standards (IFRS). Generally, the historical cost principle is applied, with the exception of financial assets
at fair value through profit or loss, derivative financial instruments and financial investments available-for-sale, as well as certain financial
liabilities, which are measured at fair value.
USE OF ESTIMATES IN PREPARING THE CONSOLIDATED FINANCIAL STATEMENTS
In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect reported income,
expenses, assets, liabilities and disclosure of contingent liabilities. Actual results in future periods could differ from such estimates.
Estimates and assumptions are used mainly in the following areas of the consolidated financial statements and are discussed in the
corresponding notes: determining fair values of financial instruments, provisions and valuation allowances, pension assets and liabilities,
deferred taxes assets, share-based payments, goodwill and other intangible assets.
ACCOUNTING POLICIES
All Group companies apply uniform accounting and valuation principles, which remained the same as in the previous year, except as outlined at
the end of this summary of significant accounting policies.
Subsidiaries and associates
Subsidiaries in which GAM Holding Ltd. directly or indirectly owns a majority of the voting shares or in which it exercises control in some other
way are fully consolidated. A complete list of these companies is provided in Note 24. The financial statements of the subsidiaries are included
in the consolidated financial statements from the date that control is transferred to the Group until the date that control ceases.
The effects of all intercompany transactions and balances are eliminated on consolidation.
Foreign currency translation
The Group companies prepare their financial statements in the respective functional currency. The balance sheets of Group companies that are
denominated in foreign currencies are translated into Swiss francs at the closing exchange rates on the balance sheet date. Average exchange
rates for the reporting period are used for the income statements. Exchange differences arising from consolidation using closing and average
exchange rates for the reporting period are recognised in other comprehensive income.
In the individual financial statements of the Group companies, income and expenses denominated in foreign currencies are translated at the
exchange rate on the date of the respective transaction. Assets and liabilities are translated at the closing exchange rate on the balance sheet
date. The resulting gains and losses on monetary assets and liabilities are recognised in the income statement as foreign exchange gains/losses.
Unrealised exchange differences on equity securities available-for-sale are a component of the change in their entire fair value and are
recognised in other comprehensive income.
36 GAM Holding Ltd. Annual Report 2009