Financial review
Currency translation impact
We operate worldwide in multiple currencies and seek to match our foreign exchange exposures on an economic basis. As we have chosen the US dollar as our presentation currency, differences arise when functional currencies are translated into our presentation currency. The table below shows the effect of foreign currency rates on the translation of selected line items.
Selected balance sheet items
| variance over December 31, 2005, as of December 31, 2006 | in USD millions | in % |
|---|---|---|
| Total investments | 24,543 | 9% |
| Reserves for insurance contracts | 17,344 | 8% |
| Cumulative translation adjustment in total equity | 1,052 | 5% |
The weakening of the US dollar from December 31, 2005 to December 31, 2006 had a positive effect on balance sheet positions in US dollar terms, which are translated at closing exchange rates.
For the year ended December 31, 2006, the impact of foreign currency translation on the consolidated income statements was not significant.
