There are books that can guide you through this. For the youngest children, you would start with the concept that a baby girl grows up to be a woman and a mother, and a baby boy grows up to be a man and a father. Make sure they know the correct terms for body parts -- teach these in a casual way, without sexualizing the parts. Answer their questions, but you don't need to introduce a lot of information at this stage. Gradually, over the years, your story about how babies come into being can become more refined and detailed, letting yourself be guided by their questions.
I'm basing this answer on my experience reading Making Babies: An Open Family Book for Parents and Children Together, by Sara Bonnett Stein, with my children when they were small. There is helpful guidance for parents, and the picture book can be read on different levels.
I'm sorry I don't have anything to contribute in terms of other cultures.
Edit, 6/6: My birth culture is United States, mid Atlantic, raised by Jewish, non-practicing mother born in Germany, emigrated to the black South. I had a second cultural education in my twenties in provincial Mexico. I lived in a sequence of three European countries later on for several years each. The book I recommended is the only thoughtful approach to the question that I have come across in any of the countries I mentioned.
Living in several countries I didn't grow up in has given me a chance to see what doesn't work well in terms of helping young people make smart, informed decisions about when sex is okay and what the consequences could be, through thoughtful, age-appropriate sex education. What I've seen is that good communication between the two parties is key, whether it's two young people feeling an attraction to each other, or two young people already in a committed relationship. I've seen lots of problems stemming from partners not being able to talk to each other comfortably about sex.
There's an interesting This American Life podcast about sex education in high school, covering an innovative approach using a robotic "baby" gadget that cries and carries on if it's not fed on demand. According to the podcast report, use of this gadget helps young people understand what a tremendous commitment having a baby is. Here's the link: Act Two: And Baby Makes 0011 I don't know if this addresses your question, though, because of the high school context vs. your children's age level.
Edited 6/10 to address the "how cultures around the world teach sex-education" part of the question, assuming this is asking what is taught in school.
In New York state, elementary teachers are required to do some health lessons every year, covering certain mandated curricular content, which may be found here: http://www.p12.nysed.gov/sss/schoolhealth/schoolhealtheducation/
I think it's in first grade where anatomically correct dolls begin to be used.
I just remembered spending a month in rural Mexico and hearing from a friend there a very judgmental statement (with which I happened to agree) that her sister wasn't careful about when she made love with her husband in their one-room hut, i.e. she didn't care whether her children were awake or not. But in that environment, there was no formal sex education. There was an itinerant primary school teacher who taught mixed grades in that community occasionally. No blackboard; I'm not even sure if they had any books.