Deutsche Telekom AG, headquartered in Bonn, Germany, is the largest telecommunications company in Europe. The company uses IFRS to prepare its financial statements. The company's 2012 financial statements report the following:

The debt footnotes report details about Deutsche Telekom's financing activities as follows:

Required

a. The graphic shows changes in net debt, which is debt less cash and marketable securities. For each of the changes shown in the graphic, determine if the cash flow was operating, investing, or financing.

b. Explain why the company issues debt in so many currencies.

Transcribed Image Text:

Changes in net debt (millions of) 40,121 (6,239) Net debt at Free Jan. 1, 2012 cash flow (1,906) Payment received as part of the cell tower transaction with Crown Castle (380) 3,400 750 470 Sale of Dividend Payments Telekom payments to external Srbija (including to pension non-controlling funds interests) 411 233 36,860 Effects Spectrum Exchange Net debt at rate and Dec. 31, 2012 from acquisition the AT&T other effects transaction