Comportamientos ante el mercado

1. Information on new and amended standards and

interpretations

The new and amended standards and new interpretations that apply for reporting periods beginning on or after 1 January 2010 are listed below. All IFRS and IFRIC applicable on the reporting date and mandatory for the fiscal year 2010 have been applied.

Standard or Interpretation

Title (1 January 2010)

-Application for financial years commencing at the date that they became effective or later -

IFRS 1 New version and amendments to the first-time application of the International Financial Reporting Standards

IFRS 2 Amendments in relation to the accounting of share-based remuneration made in cash in the Group. Amendments to the scope of application through introduction of basic principles

IFRS 3/IAS 27 (revised 2008)

Corporate mergers: Extensive revision with regard to application of the acquisition method

IFRS 5

(Improvements 2008)

Non-current assets held for sale and discontinued operations

IAS 32 Classification of subscription rights and similar rights. Amendment with regard to classification of subscription rights

IAS 39 Financial instruments: Recognition and measurement. Amendments concerning risk positions that qualify for hedge accounting, amendments concerning suitable underlying transactions.

IFRIC 12 Service concession agreements.

IFRIC 15 Agreements for the construction of real estate

IFRIC 16 Hedges of a net investment in a foreign operation

IFRIC 17 Distributions of non-cash assets to owners

IFRIC 18 Transfers of assets from customers

IFRIC 19 Extinguishing financial liabilities with equity instruments

There were no significant impacts on the assets, financial and profit situation and the cash flow of Balda AG from the first time adoption of the regulations and from the first time adoption of these revised IFRS.

Standard or Interpretation

Title (date of coming into effect)

-Application for financial years commencing at the date that they became effective or later -

IFRS 1 First time adoption of IFRS, presentation of the financial statement: Amendments following improvements of May 2010, amendments for limited exemption with regard to comparative IFRS 7 disclosures (1 January 2011)

IFRS 1 Amendment for severe hyperinflation (01 July 2011)

IFRS 7 Financial instruments: Disclosures, amendment for enhancing disclosures about transfers of financial assets (01 July 2011)

IFRS 9 Financial instruments: Amendment concerning recognition and measurement of financial assets. (01 January 2013)

IAS 12 Income taxes: Limited amendment to recovery of underlying assets (01 January 2012)

IAS 24 Disclosures of related party transactions. Amendment to definitions of related parties. (1 January 2011 - not yet adopted in European Law by the European Union)

IAS 34 Interim financial reporting: Amendments following annual improvements to the IFRS of May 2010 (01 January 2011)

IFRIC 14 Amendment to IFRIC 14: Limit on a defined benefit asset, minimum funding requirements and their interaction (1 January 2011)

As part of another "Annual Improvement Project", in May 2010 the IASB published another collective standard for the amendment of the various IFRS, which was partially adopted in European Law only in the subsequent years.

There were no significant impacts on the assets, financial and profit situation and the cash flow of Balda AG from the first time adoption of these amended standards and regulations.

2. Accounting and assessment principles

The fundamental financial and assessment methods used in the preparation of these consolidated financial statements are described in the following sections. The accounting methods in general, have not changed as compared to the previous year.

All estimates and arbitrary decisions are continually reassessed and are based on historic experience and other factors, including expectations regarding future events that appear reasonable under the given circumstances. The most important statements regarding the future and the main sources of uncertainty regarding estimates that could result in a significant risk so that it may require a material adjustment to the reported assets and liabilities within the next financial year are shown below in the relevant passages of the notes.

These mainly pertain to the goodwill. To determine a potential impairment it is necessary to determine the value in use of the cash-generating entity to which the goodwill has been allocated. The calculation of value in use requires an estimate of the future cash flows from the cash-generating entity and an appropriate discount rate for the present cash value calculation. We refer to our general explanations below and the details on the calculation under Point II.5.b. "Goodwill".

The valuation of tangible and intangible fixed assets is associated with estimates of the expected useful life of these assets. At the end of each financial year, Balda checks the estimated useful life and if necessary revises it. No revisions have been made in the reporting year.

The inventories are valued at the lower acquisition or manufacturing cost determined on the basis of the weighted average method and the expected net sales value, i.e. the sales income achievable in normal business operations less the estimated costs of completion and selling.

The maturity structure of the balances of receivables and customers' creditworthiness as well as changes in payment terms have been taken into account in the assessment of the adequacy of the provisions for doubtful debts. The extent of actual write-offs to be made may exceed the extent of the expected write-offs if the customers' financial situation deteriorates.

Assessments must be made during the calculation of current and deferred taxes. Deferred tax assets are reported if it is likely that they can actually be used. Various other factors such as the past financial situation and tax planning are to be taken into account in assessing the likelihood of their future use. If the actual results vary from these estimates, it could have a negative impact on the asset, financial and profit situation.

The accounting and valuation methods were applied in a uniform manner in the Group and in comparison with the previous year.