Options, futures, forwards and swaps are important examples of derivative financial instruments. Earnings from ordinary activities Pre-tax profit or loss from activities which an enterprise undertakes in the normal course of business. This does not include extraordinary items, i.e. income or expenses that arise from events or transactions that are clearly distinct from the ordinary activities of the enterprise and are therefore not expected to recur frequently or regularly. Ratio calculated by dividing the consolidated profit or loss for the year by the average number of shares issued. For calculating diluted earnings per share the number of shares and the profit or loss for the year are adjusted by the dilutive effects of any rights to subscribe for shares which have been or can still be exercised.
Subscription rights arise in connection with issues of convertible bonds or share options.
The relevant proportion of cost of the investment in a subsidiary is set off against the relevant proportion of the shareholders ' equity of the subsidiary at the date of acquisition. Equity method Investments in joint ventures and associated enterprises are accounted for by this method. In the case of investments in enterprises which prepare consolidated financial statements of their own, the valuation is based on the sub-group 's consolidated net assets. The valuation is subsequently adjusted to reflect the proportionate share of changes in the enterprise 's net assets, a proportionate share of the enterprise 's net earnings for the year being added to the Group 's consolidated income. The amount for which an asset could be exchanged between knowledgeable, willing parties in an arm 's length transaction.