NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOREIGN CURRENCY Income statement items in foreign currencies are converted at the weighted average currency exchange rates for the reporting period. Calculation differences resulting from using year-end exchange rates in the balance sheet and weighted average exchange rates in the income statement are charged or credited directly to shareholders’ equity under the caption currency exchange rate differences. Equity held in subsidiaries not accounted for in euro, to the level of self-imposed requirements applied within the group, is not hedged against currency exchange rate movements. Equity amounts in excess of these requirements held in subsidiaries can be hedged. All currency results related to equity held in subsidiaries and the funding thereof, including results and related costs from hedging transactions on those subsidiaries, are accounted for in shareholders’ equity under the caption currency exchange rate differences. Other currency exchange rate differences are included in the income statements. Assets and liabilities denominated in foreign currencies are converted into euro at the year-end exchange rates. Currency exchange rate differences resulting from the conversion of foreign currencies investments in shares and real estate are accounted for in shareholders’ equity. AEGON GROUP ANNUAL REPORT 2003 86 Weighted average exchange rates applied for income statement items: 2003 2002 2001 US Dollar (USD) 1.13110 0.94680 0.89540 Pound Sterling (GBP) 0.69090 0.62830 0.62130 Canadian Dollar (CAD) 1.58090 1.48470 1.38850 Hungarian Forint (HUF) 253.34000 242.88000 257.30000 Taiwan Dollar (NTD) 39.15000 32.77000 29.68200 2003 2002 US Dollar (USD) 1.26300 1.04870 Swiss Franc (CHF) 1.55790 1.45240 Pound Sterling (GBP) 0.70480 0.65050 Canadian Dollar (CAD) 1.62340 1.65500 Japanese Yen (JPY) 135.05000 124.39000 Hungarian Forint (HUF) 262.50000 235.90000 Taiwan Dollar (NTD) 42.88000 36.11000 The most important closing rates at December 31 are: