The unaudited interim report of Linde AG at 30 September 2006 has been drawn up in accordance with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB), London, where these became operative on or before 30 September 2006. The term IFRS also includes International Accounting Standards (IAS) where these are still effective and the interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC) – formerly the Standing Interpretations Committee (SIC). In accordance with the EU Regulation dated 19 July 2002 (EC No. 1606/2002), only those IFRS standards which have already been adopted by the European Commission have been applied in the quarterly report.

We have used the same recognition and measurement policies to draw up the interim report as those used to prepare the Group financial statements for the year ended 31 December 2005, with the exception of the following changes, and have also applied IAS 34 "Interim Financial Statements".

With effect from 1 January 2006, Linde AG has applied IFRIC 4 "Determining Whether an Arrangement contains a Lease". The application of this Standard will result in certain technical equipment in the Linde Gas division being recognised as finance leases. As a result, there was a transfer from tangible assets to receivables from financial services and the reclassification of part of the corresponding revenue in the financial result. The change in accounting policy required by IFRIC 4 results in a restatement of prior year figures ("restated"). Further details about the effect of the change in accounting policy are given in the note on "Embedded leases".

Furthermore as off 31 December 2005, IAS 19 was amended in respect of the recognition of actuarial gains and losses relating to the measurement of pension provisions. At 31 December 2005, Linde AG made use of the newly available option of immediately recognising actuarial gains and losses in equity. As a result of this change in accounting policy at 31 December 2005, the comparatives in these quarterly financial statements have been restated ("restated").

In addition to the Standard referred to above, the following new or amended Standards and Interpretations issued by IASB and IFRIC came into effect on 1 January 2006. However, either these did not have a significant effect on the net assets, financial position and results of operations of the Group or they were not relevant for the Group financial statements.