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## Notes to the consolidated financial statements 

For the year ended 31 December 2012 

## 2. Summary of significant accounting policies continued 

## IAS 19 Employee Benefits (amended) 

The amendments to IAS 19 Employee Benefits were issued in December 2010 and are effective for annual periods beginning on or after 1 January 2013. The amendments especially relate to: 

 eliminating an option to defer the recognition of gains and losses, known as the ‘corridor method’, improving comparability and faithfulness of presentation; 

 streamlining the presentation of changes in assets and liabilities arising from defined benefit plans, including requiring remeasurements to be presented in other comprehensive income (OCI), thereby separating those changes from changes that many perceive to be the result of an entity’s day-to-day operations; 

 enhancing the disclosure requirements for defined benefit plans, providing better information about the characteristics of defined benefit plans and the risks that entities are exposed to through participation in those plans. 

Since the Group does not operate any defined benefit plan, the Group does not expect a material effect on its financial statements resulting from this amendment. 

Improvements to IFRSs – a collection of amendments to International Financial Reporting Standards (annual improvements project) The IASB has also issued a collection of amendments to various IFRSs (“Improvements to IFRSs”) in May 2012, which are effective for annual periods beginning on or after 1 January 2013. This includes amendments to various existing IFRSs. Dialog does not expect a material impact on the financial position nor the financial performance of Dialog. The amended standards have not yet been endorsed by the EU. 

In addition, the following interpretation has been issued: 

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$^{1)}$ IFRIC 20 is not relevant to the operations of the Group 

The Group does not intend to make early application of the amended or revised Standards and Interpretation listed above. 

## Principles of consolidation and investments in affiliated companies 

The consolidated financial statements include Dialog Semiconductor Plc and its subsidiaries as at 31 December each year: 

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Subsidiaries are fully consolidated from the date of acquisition, being the date on which Dialog obtains control, and continue to be consolidated until the date such control ceases. 

The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. 

All intra-group balances, transactions, unrealised gains and losses resulting from intra-group transactions and dividends are eliminated in full. 

