ence arisin g because s t atements of income are tr anslated usin g a v er a g e r ates while balance sheets are tr anslated usin g e x chan g e r ates pre v ailin g at each balance sheet date is pos ted directly to other comprehensiv e income Where loans ha v e been r aised to reduce the Group s foreign e x chan g e tr anslation e xposure in foreign net assets and qualif y for the hed g e accountin g criteria e x chan g e r ate diferences on such loans are recogniz ed tog ether with the e x chan g e r ate diferences arisin g from the tr anslation of foreign net assets in other comprehensiv e income The accumulated tr anslation difer ences are accounted for in tr anslation reser v e in equit y When a foreign oper ation or part thereof is sold such e x chan g e diferences are recogniz ed in the s t atement of income as part of the gain or loss on sale G oodwill and fair v alue adjus tments arisin g on the acquisition of a foreign entit y are treated as assets and liabilities of the foreign entit y and tr anslated usin g e x chan g e r ates pre v ailin g at each balance sheet date T r ansactions receiv ables and liabilities in foreign currenc y IAS 21 T r ansactions in foreign currenc y are tr anslated into the functional currenc y in accor dance with the e x chan g e r ates pre v ailin g at the date of the tr ansac tion Ex chan g e diferences on monet ar y items are recogniz ed in the s t ate ment of income when the y arise with the e x ception of net in v es tment hed g es recogniz ed via other comprehensiv e income see abo v e under the section T r anslation of foreign subsidiaries Ex chan g e diferences from oper atin g items are recogniz ed as either production e xpenses or sellin g and adminis tr ativ e e xpenses while e x chan g e diferences from fnancial items are recogniz ed as fnancial income or fnancial e xpenses When preparin g the fnancial s t atements of individual companies foreign currenc y denominated receiv ables and liabilities are tr anslated to the functional currenc y of the individual compan y usin g the e x chan g e r ates pre v ailin g at each balance sheet date R e v enue recognition IAS 11 and IAS 18 The Group s re v enue is g ener ated mainly from v arious t ypes of securit y ser vices There is also re v enue from the sale of alarm products and to a limited e xtent cash handlin g ser vices R e v enue from ser vices is recogniz ed in the period in which it is earned Alarm ins t allations are recogniz ed in re v enue as the y are completed in accor dance with the percent a g e of completion method Accor din g to this method re v enue e xpenses and thus income are recogniz ed in the period in which the w ork w as undert ak en The deter mination of the percent a g e of alarm ins t allations that can be recogniz ed as re v enue is based on the time spent in relation to the tot al es timated time T r ademark fees from the former subsidiar y Securit as Direct AB relatin g to the use of the Securit as tr ademark are recogniz ed on an accrual basis in accor dance with the subs t ance of the a greement and are based on the sales recogniz ed b y Securit as Direct AB Interes t income is recogniz ed in the s t atement of income in the period to which it is at tribut able Oper atin g se gments IFRS 8 Oper atin g se gments are business activities that ma y earn re v enues or incur e xpenses whose oper atin g results are re gularly re view ed b y the chief oper atin g decision mak er the President and CEO and for which discrete fnan cial information is a v ailable Oper atin g se gments cons titutes the oper ational s tructure for g o v ernance monitorin g and reportin g A combination of fac tor s has been used in or der to identif y the Group s se gments M os t impor t ant is the char acteris tic s of the ser vices pro vided and the g eogr aphical split F or information re gar din g the se gments oper ations refer to note 9 Accor din g to the conditions in IFRS 8 cert ain of the Group s oper atin g se gments ha v e been a g gre gated in the fnancial reportin g The Group s oper ations are consequently divided into four report able se gments Securit y Ser vices North America Securit y Ser vices Europe for 2011 and 2010 consis ted of an a g gre gation of the t w o oper atin g se gments Securit y Ser vices Europe and A viation M obile and M onitorin g consis tin g of an a g gre gation of the oper atin g se gment M obile and the oper atin g se gment M onitorin g Securit y Ser vices Ibero America and Other consis tin g of an a g gre gation of all other oper atin g se gments These se gments are also referred to as business se gments in the Group s fnancial reports As of 2013 the Securit y Ser vices Europe and M obile and m onitorin g business se gments will be mer g ed into one business se gment named Securit y Ser vices Europe The Group s oper ations will then be divided into three report able se gments and Other consis tin g of an a g gre gation of all other oper atin g se gments Other includes all other oper atin g se gments as w ell as g ener al adminis tr ativ e e xpenses e xpenses for head ofces and other centr al e xpenses All other oper atin g se gments comprise the guar din g oper ations in the M i d d l e Eas t Asia and Africa as w ell as oper ations within securit y c o n s u l t i n g that report directly to the chief oper atin g decision mak er U ntil October 21 2011 Other also includes the Group s joint v enture Securit as Direct S A S witz erland which has been div es ted as of this date The assets and liabilities of each se gment include only those items that ha v e been utiliz ed or arisen in on g oin g oper ations Nonoper ational balance sheet items primarily current t ax deferred t ax and pro visions for t ax es are accounted for under the Other headin g in the t able Capit al emplo y ed and fnancin g in note 9 In the t able Assets and liabilities in the same note these items are accounted for as unallocated noninteres t bearin g assets and unallocated noninteres t bearin g liabilities A reconciliation bet w een tot al se gments and the Group is disclosed in note 9 G eogr aphical information related to sales and noncurrent assets is disclosed in note 9 for S w eden which is Securit as countr y of domicile and for all individual countries where the sales or noncurrent assets e x ceed 10 percent of the tot al amount for the Group The g eogr aphical split of sales is based on the location of the sales The location of the sales corresponds in all material aspects to the location of the cus tomer s There are no sales to an y individual cus tomer that are deemed to represent a signifcant portion of the Group s tot al sales Accountin g for g o v ernment gr ants and disclosure of g o v ernment assis t ance IAS 20 Securit as lik e other emplo y er s is elig ible for a v ariet y of gr ants relatin g to emplo y ees These gr ants relate to tr ainin g incentiv es for hirin g new s t af reduction of w orkin g hour s etc All gr ants are accounted for in the s t ate ment of income as a cos t reduction in the same period as the related under lyin g cos t T ax es IAS 12 Deferred income t ax is pro vided in full usin g the liabilit y method on tempo r ar y diferences arisin g bet w een the t ax bases of assets and liabilities and their carr yin g amounts in the consolidated fnancial s t atements Ho w e v er if the deferred income t ax arises from initial recognition of an asset or liabilit y in a tr ansaction other than a business combination that at the time of the tr ansaction afects neither accountin g nor t axable proft or loss it is not accounted for Deferred income t ax is determined usin g t ax r ates and la ws that ha v e been enacted or subs t antially enacted b y the balance sheet date and are e xpected to apply when the related deferred income t ax asset is realiz ed or the deferred income t ax liabilit y is set tled A deferred t ax asset is recogniz ed when it is probable that sufcient t axable income will arise that the deferred t ax asset can be ofset a gains t Deferred t ax assets are v alued as of the balance sheet date and an y potential pre viously un v alued deferred t ax asset is recogniz ed when it is e xpected to be usable or correspondin g ly reduced when it is e xpected to be wholly or partly unusable a gains t future t axable income Current and deferred t ax es are pos ted directly to other comprehensiv e income if the rele v ant underlyin g tr ansaction or e v ent is pos ted directly to other comprehensiv e income in the period or pre vious period if it pert ains to an adjus tment of an openin g balance of ret ained earnin g s as the result of a chan g e in accountin g principle Chan g es in current and deferred t ax es that relates to e x chan g e r ate diferences in the tr anslation of the balance sheets of foreign subsidiaries are pos ted to tr anslation diferences in other comprehensiv e income Pro visions are allocated for es timated t ax es on dividends paid from subsidiaries to the Parent Compan y in the follo win g y ear 77 Annual R eport Notes and comments to the consolidated fnancial s t atements Securit as Annual R eport 2012