Annual Accounts and Report as at 30 June 2011 Draft - Mediobanca

All actuarial profits and/or losses are included under labour costs.Units accruing as from 1 January 2007 paid into complementary pensionschemes or the Italian national insurance system are recorded on the basis ofcontributions accrued during the period.Provisions for liabilities and chargesThese regard risks linked with the Group’s operations but not necessarilyassociated with failure to repay loans, and which could lead to expenses in thefuture. If the time effect is material, provisions are discounted using currentmarket rates. Provisions are recognized in the profit and loss account.Provisions are reviewed on a regular basis, and where the charges that gaverise to them are deemed unlikely to crystallize, the amounts involved are writtenback to the profit and loss account in part or in full.Withdrawals are only made from provisions to cover the expenses for whichthe provision was originally made.Foreign currency transactionsTransactions in foreign currencies are recorded by applying the exchangerates as at the date of the transaction to the amount in the foreign currencyconcerned.Assets and liabilities denominated in currencies other than the Euro aretranslated into Euros using exchange rates ruling at the dates of the transactions.Differences on cash items due to translation are recorded through the profit andloss account, whereas those on non-cash items are recorded according to thevaluation criteria used in respect of the category they belong to (i.e. at cost,through the profit and loss account or on an equity basis).Tax assets and liabilitiesIncome taxes are recorded in the profit and loss account, with the exceptionof tax payable on items debited or credited directly to net equity. Provisions forincome tax are calculated on the basis of current, advance and deferredobligations. Advance and deferred tax is calculated on the basis of temporarydifferences – without time limits – between the carrying amount of an asset orliability and its tax base, according to statutory criteria and the correspondingvalues used for tax purposes.300 –