The Wincor Nixdorf Group (in the following “Wincor Nixdorf” or the “Group”) was demerged from Siemens Group by means of a leveraged buy-out on October 1, 1999. The ultimate parent company is Wincor Nixdorf AG located in Paderborn, Germany. The company is registered at the local court office in Paderborn, Germany. The stock of Wincor Nixdorf is listed on the Frankfurt Stock Exchange in the Prime Standard segment and is part of the MDAX. The Group’s fiscal year commences on October 1 and ends on September 30 of the subsequent calendar year.

Wincor Nixdorf is one of the world’s leading providers of IT solutions to retailers and retail banks. Our extensive portfolio is aimed at optimizing business processes within bank branches and retail outlets. This is essentially about reducing complexity and cost, and improving service to the end customer.

Wincor Nixdorf is represented in over 90 countries around the world and has its own subsidiary companies in 34 of these.

Major business geographies are Germany and Europe; however, the company also operates in America, Africa and Asia.

The Group’s production facilities are located in Paderborn and Arnstadt (Germany), Burgdorf (Switzerland), Singapore, Shanghai (China) and São Paulo (Brazil). Research and development locations are Germany, Switzerland, Singapore, Indonesia, the U.S. and China.

The Banking Division proposition includes automated teller machines, bank statement printers, services and multimedia information and service terminals – targeted at banks as well as other service providers. Through its Retail Division, Wincor Nixdorf provides products, solutions and services covering the entire value added chain in the retail industry. Key elements of the company’s proposition include in-store solutions such as point-of-sale systems, consulting services and implementation of company-wide solutions covering the issues Enterprise Resource Planning, Category Management, Customer Relationship Management and eCommerce.

Reported figures are shown in thousands of euros (€k).

On November 24, 2006, the Board of Directors of Wincor Nixdorf AG released the Group financial statements for the purpose of forwarding them to the Supervisory Board. The Supervisory Board is responsible for assessing the Group financial statements and specifying whether it is in a position to issue an approval of the Group financial statements.

Use of International Financial Reporting Standards (IFRS).
The Group financial statements of Wincor Nixdorf AG as of September 30, 2006, have been prepared in accordance with the International Financial Reporting Standards (IFRS) produced by the International Accounting Standards Board (IASB), London, mandatory at the balance sheet date. All of the International Accounting Standards (IAS), interpretations of the International Financial Reporting Interpretations Committee/Standing Interpretations Committee (IFRIC/SIC) binding in the European Union during the fiscal year 2005/2006 as well as the statutory requirements according to Section 315a (1) of the German Commercial Code have been considered.

In fiscal 2005/2006, Wincor Nixdorf AG has applied the following standards which have been revised in the course of the “Improvements Project”:

• IAS 1 “Presentation of Financial Statements“
• IAS 2 “Inventories”
• IAS 8 “Accounting Policies, Changes in Accounting Estimates and Errors”
• IAS 10 “Events after the Balance Sheet Date”
• IAS 16 “Property, Plant and Equipment”
• IAS 17 “Leases”
• IAS 21 “The Effects of Changes in Foreign Exchange Rates”
• IAS 24 “Related Party Disclosures”
• IAS 27 “Consolidated and Separate Financial Statements”
• IAS 28 “Investments in Associates”
• IAS 31 “Interests in Joint Ventures”
• IAS 32 “Financial Instruments: Disclosure and Presentation”
• IAS 33 “Earnings per Share”
• IAS 39 “Financial Instruments: Recognition and Measurement”
• IAS 40 “Investment Property”
• IFRS 4 “Insurance Contracts”
• IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations”

These standards are applied in conformity with the applicable transitional provisions. To the extent that individual standards contain no specific provisions and no further details have been provided in the subsequent sections, all standards have been applied retrospectively, i.e. as if the new accounting policies had always been applied. Figures pertaining to the preceding year were adjusted accordingly.

The first-time application of the revised International Financial Reporting Standards has mainly the following effects on the Group financial statements of Wincor Nixdorf AG as of September 30, 2006:

IAS 1 “Presentation of Financial Statements”

The IAS 1 revision means the balance sheet has to be presented by current/non-current distinction. Assets and liabilities are divided up into current and non-current items, and equity now also includes minority interest.

Current assets are those

• which are turned over within the entity’s normal operating cycle,
• which are primarily held for the purpose of being traded,
• which are expected to be realized within twelve months after the balance sheet date or
• which are cash or cash equivalents.

Current liabilities are those

• which are expected to be settled within the entity’s normal operating cycle,
• which are primarily held for the purpose of being traded,
• which are due to be settled within twelve months after the balance sheet date or
• in respect of which the entity does not have an unconditional right to defer settlement of the liability for at least twelve months after the balance sheet date.

This differentiation results in a change to the structure of the balance sheet of Wincor Nixdorf AG in fiscal 2005/2006. The Group balance sheet as of September 30, 2005 has been adjusted accordingly, with trade receivables, other assets, other accruals, financial liabilities and other liabilities split up into constituent current and non-current components. Accruals for pensions and similar commitments are characterized as non-current liabilities. Deferred taxes have to be classified as non-current.

In addition, spare parts used by the service business have so far been reported under inventories. These are split up into reworkable service parts and other spare parts. If reworkable parts of Wincor Nixdorf products break down, they are made serviceable again by Wincor Nixdorf or other service providers under a logistics and repairs process and returned to the spare parts inventory. As per typical industry practice, reworkable service parts are now being reported for the first time as non-current assets. Write-down of reworkable service parts is presented separately in the Group Cash Flow statement.

The profit or loss attributable to minority interest is included in the profit for the period in the Consolidated Statement of Income. The profit attributable to equity holders of Wincor Nixdorf AG and the profit attributable to minority interest is shown separately.

In addition, the following standards, interpretations and amendments have been released by the IASB; however, they are not yet applicable for the Group financial statements of Wincor Nixdorf AG in fiscal 2005/2006:

Amendments to IFRS 4 “Insurance Contracts” (to be applied after January 1, 2006)

IFRS 6 “Exploration for and Evaluation of Mineral Resources” (to be applied after January 1, 2006)

IFRS 7 “Financial Instruments: Disclosures” (to be applied after January 1, 2007)

Amendments to IAS 1 “Presentation of Financial Statements” (to be applied after January 1, 2006)

Amendments to IAS 19 “Employee Benefits” (to be applied after January 1, 2006)

Amendments to IAS 21 “The Effects of Changes in Foreign Exchange Rates” (to be applied after January 1, 2006)

Amendments to IAS 39 “Financial Instruments: Recognition and Measurement” (to be applied after January 1, 2006)

IFRIC 4 “Determining whether an Arrangement Contains a Lease” (to be applied after January 1, 2006)

IFRIC 5 “Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds” (to be applied after January 1, 2006)

IFRIC 6 “Liabilities arising from Participating in a Specific Market – Waste Electrical and Electronic Equipment” (to be applied after December 1, 2005)

IFRIC 7 “Applying the Restatement Approach under IAS 29“ (to be applied after March 1, 2006)

IFRIC 8 “Scope of IFRS 2” (to be applied after May 1, 2006)

IFRIC 9 “Reassessment of Embedded Derivatives” (to be applied after June 1, 2006)

We intend to consider the standards, interpretations and amendments in our consolidated financial statements in the fiscal year in which they have to be applied according to the guidelines of the IASB. We do not expect any material effects on the Group financial statements of Wincor Nixdorf AG at the moment of first-time adoption.