Accounting policies In accordance with § 53 (6) of the Exchange Rules for the Frankfurter Wertpapierbörse (FWB), Deutsche Telekom AG voluntarily publishes a quarterly financial report that comprises interim consolidated financial statements and an interim Group management report. The interim consolidated financial statements were prepared in accordance with the International Financial Reporting Standards (IFRSs) applicable to interim financial reporting as adopted by the EU. The interim management report for the Group was prepared in accordance with the German Securities Trading Act (Wertpapierhandelsgesetz – WpHG). Statement of compliance The interim consolidated financial statements for the period ended September 30, 2020 are in compliance with International Accounting Standard (IAS) 34. As permitted by IAS 34, it has been decided to publish a condensed version compared to the consolidated financial statements at December 31, 2019. All IFRSs applied by Deutsche Telekom AG have been adopted by the European Commission for use within the EU. In the opinion of the Board of Management, the reviewed quarterly financial report includes all standard adjustments to be applied on an ongoing basis that are required to give a true and fair view of the results of operations and financial position of the Group. Please refer to the notes to the consolidated financial statements as of December 31, 2019 for the accounting policies applied for the Group’s financial reporting. Initial application of standards, interpretations, and amendments in the reporting period Pronouncement Title To be applied by Deutsche Telekom from Changes Expected impact on the presentation of Deutsche Telekom’s results of operations and financial position Amendments to References to the Conceptual Framework References to the Conceptual Framework Jan. 1, 2020 Updating of the cross references to the revised conceptual framework in the corresponding standards and interpretations. No material impact. Amendments to IAS 1 and IAS 8 Definition of Material Jan. 1, 2020 Clarification of the definition of the concept of materiality. No material impact. Amendments to IFRS 3 Business Combinations Jan. 1, 2020 Changes in the definition of a business to clarify whether a business or a group of assets was being acquired. No material impact. Amendments to IFRS 9, IAS 39, and IFRS 7 Interest Rate Benchmark Reform (Phase 1) Jan. 1, 2020 Practical expedients for hedge accounting requirements that are mandatory for all hedges affected by the interest rate benchmark reform. Further information on this is also planned. The effects are detailed in the explanations following this table. The reform of interbank offered rates (IBORs) is currently generating uncertainty regarding the timing of implementation and the precise content of the planned changes. Deutsche Telekom is affected by this uncertainty in its hedging of interest rate and currency risks in designated fair value and cash flow hedges where certain IBORs are part of the hedging relationship (EURIBOR, USD-LIBOR, GBP-LIBOR, AUD-LIBOR, CHF-LIBOR, HKD-LIBOR, and NOK-OIBOR). Group Treasury continuously analyzes the latest developments and takes any steps needed to transition to the new interest rate benchmarks. Deutsche Telekom does not expect the changes in the benchmark rates to have a material impact. For information on hedging relationships, please refer to the section “Disclosures on financial instruments.” For more information on standards, interpretations, and amendments that have been issued but not yet applied, as well as disclosures on the recognition and measurement of items in the statement of financial position and discretionary decisions and estimation uncertainties, please refer to the section “Summary of accounting policies” in the notes to the consolidated financial statements in the 2019 Annual Report. Changes in accounting policies and changes in the reporting structure Deutsche Telekom did not make any major changes to its accounting policies in the reporting period. With effect from July 1, 2020, TC Services and Classified ICT, portfolio units previously assigned to the Systems Solutions operating segment, as well as Telekom Global Carrier (TGC) and Network Infrastructure (NWI), which had formerly been disclosed under the Europe operating segment and the Group Headquarters & Group Services segment respectively, and which together form the business area designated Deutsche Telekom Global Carrier (DTGC), have been combined in the Germany operating segment. Since then, the management of the Deutsche Telekom Group and hence also the reporting structure both have been based on this new segment allocation. As part of these transactions, the assets and liabilities assigned to the business areas were transferred to the Germany operating segment. Prior-year comparatives in the segments affected have been adjusted retrospectively in segment reporting. The transactions were consummated under company law on July 1, 2020 (TC Services and Classified ICT) and on October 1, 2020 (DTGC). schließen ICT Information and Communication Technology schließen Carrier A telecommunications network operator.