In August 2004, Software AG streamlined its international structure (see second-quarter report, events subsequent to the balance-sheet date). The Company’s activities are now organized into three regions:

• North America/Northern Europe (USA, Canada, United Kingdom, Scandinavia, South Africa)
• South (Southern Europe, South and Central America)
• Central/Asia (German-speaking countries, Eastern Europe, Middle East, Asia, Australia)

This third-quarter report is still based on the four regions structure to make comparison with the previous quarter and the first half of 2004 easier.

Reporting
Software AG financial reporting for 2004 is being prepared according to International Financial Reporting Standards (IFRS). You can find more information on the accounting methods used and the reconciliation with 2003 figures here.