IFRS PRACTICAL IMPLEMENTATION GUIDE AND WORKBOOK

Chapter 6/ Accounting Policies, Changes ill Accounting Estimates and Errors (lAS 8)

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12. EXTRACTS FROM PUBLISHED FINANCIAL STATEMENTS

NOKIA, December 31, 2006 Notes to the Consolidated Financial Statements Change in method of quantifying misstatements

During the year, the Group changed its method of quantifying misstatements. The Group previously quantified misstatements based on the amount of the error originating in the current year profit and loss account statement. The Group has now decided to consider the effect of any misstatements based on both ( I) the amount of the misstatement originating in the current year profit and loss account statement and (2) the effects of correcting the misstatement existing in the balance sheet at the end of the current year irrespective of the year in which the misstatement originated. As a result of this change, management has adjusted its financial statements and previously reported deferred tax assets and retained earnings have been increased by EUR 154 million for each period presented. Under the previous method of quantifying misstatements these adjustments were considered to be immaterial. These deferred tax assets relate to certain of the Group' s warranty and other provisions recorded in periods prior to 2002, for which no corresponding tax amounts were deferred.