Foreign
currencies

Functional and presentation currency

Items presented in the financial statements of the individual Group entities, including KREDOBANK SA, Finansowa Kompania ‘Prywatne Inwestycje’ Sp. z o.o., UKRPOLINWESTYCJE Sp. z o.o. and PKO Finance AB are measured in functional currency i.e. in the currency of the basic economic environment in which the given entity operates. The functional currency of the parent company and other entities included in these financial statements, except for KREDOBANK SA, Finansowa Kompania ‘Prywatne Inwestycje’ Sp. z o.o., UKRPOLINWESTYCJE Sp. z o.o. and PKO Finance AB is the Polish zloty. The functional currency of KREDOBANK SA, Finansowa Kompania ‘Prywatne Inwestycje’ Sp. z o.o. and UKRPOLINWESTYCJE Sp. z o.o. is the Ukrainian hrivna and the functional currency of PKO Finance AB is Euro.

Consolidated financial statements are presented in the Polish zloty, which is the functional and presentation currency of the Group.

Transactions and balances denominated in foreign currencies

Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the transactions. At each balance sheet date items are translated by the Group using the following principles:

  1. monetary assets denominated in foreign currency are translated into Polish zloty using a closing rate i.e. the average rate communicated by the National Bank of Poland for a given currency prevailing at the balance sheet date,
  2. non-monetary assets valued at historical cost in foreign currency are translated into Polish zloty using exchange rates prevailing on a day of a particular transaction,
  3. non-monetary assets designated at fair value through profit and loss in foreign currency are translated into Polish zloty using exchange rates as at the date of the determination of fair value.

Gains and losses on settlements of these transactions and the carrying amount of monetary and monetary assets and liabilities denominated in foreign currencies are recognised in the income statement.

UAH 2011 2010
Rate prevailing on the last day of the period 0.4255 0.3722
Rate representing the arithmetical mean of the rates prevailing on the last day of each month of the period 0.3716 0.3830
The highest rate in the period 0.4267 0.4406
The lowest rate in the period 0.3330 0.3423


EUR 2011 2010
Rate prevailing on the last day of the period 4.4168 3.9603
Rate representing the arithmetical mean of the rates prevailing on the last day of each month of the period 4.1401 4.0044
The highest rate in the period 4.5494 4.1458
The lowest rate in the period 3.9345 3.8622