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|
CARRYING AMOUNT OF FINANCIAL INSTRUMENTS BY | ||||
|
€ million |
Dec. 31, 2011 |
Dec. 31, 2010 | ||
|---|---|---|---|---|
|
Financial assets at fair value through profit or loss |
9,096 |
2,605 | ||
|
Loans and receivables |
92,163 |
80,985 | ||
|
Available-for-sale financial assets |
9,197 |
6,143 | ||
|
Financial liabilities at fair value through profit or loss |
1,026 |
665 | ||
|
Financial liabilities measured at amortized cost |
112,976 |
92,110 | ||
RECONCILIATION OF BALANCE SHEET ITEMS TO CLASSES OF FINANCIAL INSTRUMENTS
The following table shows the reconciliation of the balance sheet items to the relevant classes of financial instruments, broken down by carrying amount and fair value of the financial instruments.
The fair value of financial instruments measured at amortized cost, such as receivables and liabilities, is calculated by discounting using a market rate of interest for a similar risk and matching maturity. For reasons of materiality, the fair value of current balance sheet items is deemed to be their carrying amount.
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RECONCILIATION OF BALANCE SHEET ITEMS TO CLASSES OF | ||||||||||||
|
|
Measured at fair value |
Measured at amortized cost |
Not within scope of IFRS 7 |
Other – not financial instruments |
Balance Sheet item at Dec. 31, 2010 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
€ million |
Carrying amount |
Carrying amount |
Fair value |
Carrying amount |
Carrying amount |
| ||||||
|
Noncurrent assets |
|
|
|
|
|
| ||||||
|
Equity-accounted investments |
– |
– |
– |
13,528 |
– |
13,528 | ||||||
|
Other equity investments |
– |
640 |
640 |
– |
– |
640 | ||||||
|
Financial services receivables |
– |
35,817 |
36,220 |
– |
– |
35,817 | ||||||
|
Other receivables and financial assets |
3,595 |
2,592 |
2,612 |
– |
1,333 |
7,519 | ||||||
|
|
|
|
|
|
|
| ||||||
|
Current assets |
|
|
|
|
|
| ||||||
|
Trade receivables |
– |
6,883 |
6,883 |
– |
– |
6,883 | ||||||
|
Financial services receivables |
– |
30,164 |
30,164 |
– |
– |
30,164 | ||||||
|
Other receivables and financial assets |
921 |
2,767 |
2,767 |
– |
2,918 |
6,605 | ||||||
|
Marketable securities |
5,501 |
– |
– |
– |
– |
5,501 | ||||||
|
Cash, cash equivalents and time deposits |
– |
18,670 |
18,670 |
– |
– |
18,670 | ||||||
|
|
|
|
|
|
|
| ||||||
|
Noncurrent liabilities |
|
|
|
|
|
| ||||||
|
Noncurrent financial liabilities |
– |
37,159 |
38,665 |
– |
– |
37,159 | ||||||
|
Other noncurrent liabilities |
1,469 |
320 |
323 |
– |
2,952 |
4,742 | ||||||
|
|
|
|
|
|
|
| ||||||
|
Current liabilities |
|
|
|
|
|
| ||||||
|
Current financial liabilities |
– |
39,852 |
39,852 |
– |
– |
39,852 | ||||||
|
Trade payables |
– |
12,544 |
12,544 |
– |
– |
12,544 | ||||||
|
Other current liabilities |
1,193 |
2,495 |
2,495 |
– |
6,939 |
10,627 | ||||||
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|
RECONCILIATION OF BALANCE SHEET ITEMS TO CLASSES OF | ||||||||||||
|
|
Measured at fair value |
Measured at amortized cost |
Not within scope of IFRS 7 |
Other – not financial instruments |
Balance Sheet item at Dec. 31, 2011 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
€ million |
Carrying amount |
Carrying amount |
Fair value |
Carrying amount |
Carrying amount |
| ||||||
|
Noncurrent assets |
|
|
|
|
|
| ||||||
|
Equity-accounted investments |
– |
– |
– |
10,249 |
– |
10,249 | ||||||
|
Other equity investments |
2,033 |
1,015 |
1,015 |
– |
– |
3,049 | ||||||
|
Financial services receivables |
– |
42,450 |
43,735 |
– |
– |
42,450 | ||||||
|
Other receivables and financial assets |
9,737 |
3,085 |
3,116 |
– |
1,582 |
14,405 | ||||||
|
|
|
|
|
|
|
| ||||||
|
Current assets |
|
|
|
|
|
| ||||||
|
Trade receivables |
– |
10,479 |
10,479 |
– |
– |
10,479 | ||||||
|
Financial services receivables |
– |
33,754 |
33,754 |
– |
– |
33,754 | ||||||
|
Other receivables and financial assets |
789 |
3,464 |
3,464 |
– |
4,543 |
8,796 | ||||||
|
Marketable securities |
6,146 |
– |
– |
– |
– |
6,146 | ||||||
|
Cash, cash equivalents and time deposits |
– |
18,291 |
18,291 |
– |
– |
18,291 | ||||||
|
|
|
|
|
|
|
| ||||||
|
Noncurrent liabilities |
|
|
|
|
|
| ||||||
|
Noncurrent financial liabilities |
– |
44,443 |
45,572 |
– |
– |
44,443 | ||||||
|
Other noncurrent liabilities |
2,247 |
299 |
298 |
– |
4,394 |
6,940 | ||||||
|
|
|
|
|
|
|
| ||||||
|
Current liabilities |
|
|
|
|
|
| ||||||
|
Current financial liabilities |
– |
49,090 |
49,090 |
– |
– |
49,090 | ||||||
|
Trade payables |
– |
16,325 |
16,325 |
– |
– |
16,325 | ||||||
|
Other current liabilities |
1,727 |
3,161 |
3,161 |
– |
11,209 |
16,097 | ||||||
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|
BALANCE SHEET ITEMS MEASURED AT FAIR VALUE | ||||||||
|
€ million |
Dec. 31, 2010 |
Level 1 |
Level 2 |
Level 3 | ||||
|---|---|---|---|---|---|---|---|---|
|
Financial assets at fair value through profit or loss |
|
|
|
| ||||
|
Derivatives |
4,515 |
– |
2,397 |
2,118 | ||||
|
|
|
|
|
| ||||
|
Available-for-sale financial assets |
|
|
|
| ||||
|
Other equity investments |
– |
– |
– |
– | ||||
|
Marketable securities |
5,501 |
5,491 |
10 |
– | ||||
|
Financial assets measured at fair value |
10,016 |
5,491 |
2,407 |
2,118 | ||||
|
|
|
|
|
| ||||
|
Financial liabilities at fair value through profit or loss |
|
|
|
| ||||
|
Derivatives |
2,662 |
– |
2,267 |
396 | ||||
|
Financial liabilities measured at fair value |
2,662 |
– |
2,267 |
396 | ||||
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|
BALANCE SHEET ITEMS MEASURED AT FAIR VALUE | ||||||||
|
€ million |
Dec. 31, 2011 |
Level 1 |
Level 2 |
Level 3 | ||||
|---|---|---|---|---|---|---|---|---|
|
Financial assets at fair value through profit or loss |
|
|
|
| ||||
|
Derivatives |
10,526 |
– |
1,942 |
8,584 | ||||
|
|
|
|
|
| ||||
|
Available-for-sale financial assets |
|
|
|
| ||||
|
Other equity investments |
2,033 |
2,033 |
– |
– | ||||
|
Marketable securities |
6,146 |
6,122 |
24 |
– | ||||
|
Financial assets measured at fair value |
18,706 |
8,156 |
1,966 |
8,584 | ||||
|
|
|
|
|
| ||||
|
Financial liabilities at fair value through profit or loss |
|
|
|
| ||||
|
Derivatives |
3,974 |
– |
3,379 |
595 | ||||
|
Financial liabilities measured at fair value |
3,974 |
– |
3,379 |
595 | ||||
The allocation of fair values to the three levels in the fair value hierarchy is based on the availability of observable market prices in an active market. Level 1 is used to report the fair value of financial instruments for which a quoted price is available. These include, for example, marketable securities and other equity investments measured at fair value. Fair values in Level 2, e.g. of derivatives, are measured on the basis of market inputs such as exchange rates or yield curves using market-based valuation techniques. Level 3 fair values are calculated using valuation techniques that incorporate inputs that are not directly observable in active markets. In the Volkswagen Group, Level 3 fair values comprise long-term commodity futures because the prices available on the market must be extrapolated for measurement purposes. Options on equity instruments and residual value protection models are also reported in Level 3.
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|
CHANGES IN BALANCE SHEET ITEMS MEASURED AT FAIR VALUE BASED ON LEVEL 3 | ||||
|
€ million |
Financial assets measured at fair value |
Financial liabilities measured at fair value | ||
|---|---|---|---|---|
|
Balance at Jan. 1, 2010 |
198 |
65 | ||
|
Currency changes |
– |
– | ||
|
Total comprehensive income |
1,969 |
–174 | ||
|
recognized in profit or loss |
1,953 |
–173 | ||
|
recognized in other comprehensive income |
16 |
0 | ||
|
Additions (purchases) |
– |
163 | ||
|
Realisation |
– |
– | ||
|
Transfers into Level 2 |
–48 |
–5 | ||
|
Balance at Dec. 31, 2010 |
2,118 |
396 | ||
|
|
|
| ||
|
Total gains or losses recognized in profit or loss |
1,953 |
–173 | ||
|
Net other operating expense/income |
– |
– | ||
|
of which attributable to assets/liabilities held at the reporting date |
– |
– | ||
|
Financial result |
1,953 |
–173 | ||
|
of which attributable to assets/liabilities held at the reporting date |
1,957 |
–168 | ||
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|
CHANGES IN BALANCE SHEET ITEMS MEASURED AT FAIR VALUE BASED ON LEVEL 3 | ||||
|
€ million |
Financial assets measured at fair value |
Financial liabilities measured at fair value | ||
|---|---|---|---|---|
|
Balance at Jan. 1, 2011 |
2,118 |
396 | ||
|
Currency changes |
0 |
0 | ||
|
Total comprehensive income |
6,565 |
–298 | ||
|
recognized in profit or loss |
6,541 |
–216 | ||
|
recognized in other comprehensive income |
23 |
–81 | ||
|
Additions (purchases) |
– |
– | ||
|
Realisation |
– |
83 | ||
|
Transfers into Level 2 |
–98 |
–15 | ||
|
Balance at Dec. 31, 2011 |
8,584 |
595 | ||
|
|
|
| ||
|
Total gains or losses recognized in profit or loss |
6,541 |
–216 | ||
|
Net other operating expense/income |
90 |
–116 | ||
|
of which attributable to assets/liabilities held at the reporting date |
90 |
–116 | ||
|
Financial result |
6,452 |
–100 | ||
|
of which attributable to assets/liabilities held at the reporting date |
6,414 |
17 | ||
The transfers out of Level 3 into Level 2 comprise commodity futures for which observable quoted prices are now available again for measurement purposes due to the decline in their remaining maturities; consequently, no extrapolation is required.
Commodity prices are the key risk variable for the fair value of commodity futures. Sensitivity analyses are used to present the effect of changes in commodity prices on profit after tax and equity. Starting in fiscal year 2011, the effect of changes in commodity prices is reported net of tax. The prior-year figures were adjusted to aid comparability.
If commodity prices for commodity futures classified as Level 3 had been 10% higher (lower) as of December 31, 2011, profit would have been €34 million (previous year: €5 million) and equity €38 million (previous year: €36 million) higher (lower).
The key risk variable for measuring options on equity instruments held by the Company is the relevant enterprise value. Sensitivity analyses are used to present the effect of changes in risk variables on profit.
If the assumed enterprise values had been 10% higher, profit would have been €1,322 million (previous year: €429 million) higher. If the assumed enterprise values had been 10% lower, profit would have been €1,324 million (previous year: €459 million) lower.
Residual value risks result from hedging agreements with dealers under which earnings effects caused by market-related fluctuations in residual values that arise from buy-back obligations under leases are borne in part by the Volkswagen Group.
The key risk variable influencing the fair value of the options relating to residual value risks is used car prices. Sensitivity analyses are used to quantify the effects of changes in used car prices on earnings after tax.
If the prices for the used cars covered by the residual value protection model had been 10% higher as of December 31, 2011, profit after tax would have been €141 million higher. If the prices for the used cars covered by the residual value protection model had been 10% lower as of December 31, 2011, profit after tax would have been €127 million lower.
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|
CHANGES IN CREDIT RISK VALUATION ALLOWANCES ON FINANCIAL ASSETS | ||||||||||||
|
€ million |
Specific valuation allowances |
Portfolio-based valuation allowances |
2011 |
Specific valuation allowances |
Portfolio-based valuation allowances |
2010 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Balance at Jan. 1 |
1,951 |
685 |
2,636 |
1,847 |
568 |
2,415 | ||||||
|
Currency and other changes |
–24 |
–6 |
–31 |
53 |
26 |
79 | ||||||
|
Changes in consolidated Group |
38 |
19 |
57 |
7 |
– |
7 | ||||||
|
Additions |
834 |
484 |
1,318 |
923 |
155 |
1,078 | ||||||
|
Utilization |
382 |
– |
382 |
483 |
– |
483 | ||||||
|
Reversals |
442 |
124 |
566 |
337 |
124 |
461 | ||||||
|
Reclassification |
8 |
–8 |
– |
–60 |
60 |
– | ||||||
|
Balance at Dec. 31 |
1,983 |
1,050 |
3,033 |
1,951 |
685 |
2,636 | ||||||
The valuation allowances mainly relate to the credit risks associated with the financial services business.
