Annual Report - Miba

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E. Other information
30. Cash flow statement
The cash flow statement was prepared in accordance with the indirect method. Cash and
cash equivalents are comprised solely of cash on hand, checks, deposits at credit institutions
and marketable securities. Interest received and interest paid are reported under
current operations. Dividend payments are reported under financing activities. The effects
of changes in the consolidation group are reported under the applicable items of each of
the three segments. Taxes on income and earnings during 2004/05 fiscal year amounted
to TEUR 5,822 (TEUR 10,869 in the previous year).
31. Financing instruments
IAS 32 distinguishes between original and derivative financing instruments.
Original financing instruments
Original financing instruments are accounts receivable and accounts payable (basic transactions)
and financial receivables and financial debt.
The portfolio of original financing instruments is shown in the balance sheet and in the
notes respectively, as are derivatives, provided that a market value is available.
IAS defines credit risk as losses in assets resulting from the non-performance of
contractual obligations by individual business partners.
The credit risk inherent in Miba AG Group's core business is largely secured by credit
insurance and by bank-type collateral (guarantees, letters of credit).
The internal guidelines include credit criteria designed to control the credit risk related to
original financing instruments, for example by means of bank limits or customer limits.
In the assessment field, we only work together with financial partners that have an
irreproachable credit standing.
The credit risk of derivatives is limited to transactions with a positive market value and up
to the replacement costs. Derivatives are based almost exclusively on standardized
general contracts for financial futures. In principle, derivatives are not used for trading or
speculative purposes.