12 Additional Financial Instrument Disclosures

 

 

 

 

 

 

Amounts recognized in balance sheet in accordance with IAS 39

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Measurement categories and classes:

 

Measurement category in acc. with
IAS 39

 

Carrying amounts
Jun. 30, 2017

 

Face value

 

Amortized cost

 

Acquisition cost

 

Fair value affecting net income

 

Fair value recognized in equity

 

Amounts recognized in balance sheet in acc. with IAS 17/
IAS 28

 

Fair value
Jun. 30, 2017

 

Fair value hierarchy level

in € million

                   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash on hand and deposits at banking institutions

 

LaR

 

378.1

 

378.1

 

 

 

 

 

 

 

 

 

 

 

378.1

 

1

Trade receivables

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivables from the sale of properties

 

LaR

 

180.1

 

 

 

180.1

 

 

 

 

 

 

 

 

 

180.1

 

2

Receivables from property letting

 

LaR

 

35.1

 

 

 

35.1

 

 

 

 

 

 

 

 

 

35.1

 

2

Other receivables from trading

 

LaR

 

5.5

 

 

 

5.5

 

 

 

 

 

 

 

 

 

5.5

 

2

Financial assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Joint ventures valued at equity

 

n.a.

 

7.4

 

 

 

 

 

 

 

 

 

 

 

7.4

 

7.4

 

n.a.

Loans to other investments

 

LaR

 

33.4

 

 

 

33.4

 

 

 

 

 

 

 

 

 

67.0

 

2

Other non-current loans

 

LaR

 

15.5

 

 

 

15.5

 

 

 

 

 

 

 

 

 

15.5

 

2

Non-current securities

 

AfS

 

7.8

 

 

 

 

 

 

 

 

 

7.8

 

 

 

7.8

 

1

Other investments

 

AfS

 

566.5

 

 

 

 

 

3.2

 

 

 

563.3

 

 

 

566.5

 

1

Derivative financial assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flow hedges (cross currency swaps)

 

n.a.

 

119.9

 

 

 

 

 

 

 

 

 

 

 

 

 

119.9

 

2

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trade payables

 

FLAC

 

124.1

 

 

 

124.1

 

 

 

 

 

 

 

 

 

124.1

 

2

Non-derivative financial liabilities

 

FLAC

 

14,257.6

 

 

 

14,257.6

 

 

 

 

 

 

 

 

 

14,821.1

 

2

Derivative financial liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase price liabilities from put options/rights to reimbursement

 

FLHfT

 

26.1

 

 

 

 

 

 

 

26.1

 

 

 

 

 

26.1

 

3

Stand-alone interest rate swaps

 

FLHfT

 

3.5

 

 

 

 

 

 

 

3.5

 

 

 

 

 

3.5

 

2

Other swaps

 

n.a.

 

18.3

 

 

 

 

 

 

 

 

 

 

 

 

 

18.3

 

2

Liabilities from finance leases

 

n.a.

 

105.7

 

 

 

 

 

 

 

 

 

 

 

105.7

 

207.9

 

2

Liabilities to non-controlling interests

 

FLAC

 

5.3

 

 

 

5.3

 

 

 

 

 

 

 

 

 

5.3

 

2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thereof aggregated by measurement categories in accordance with IAS 39:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and receivables

 

LaR

 

647.7

 

378.1

 

269.6

 

 

 

 

 

 

 

 

 

681.3

 

 

Available-for-sale financial assets

 

AfS

 

574.3

 

 

 

 

 

3.2

 

 

 

571.1

 

 

 

574.3

 

 

Financial liabilities held-for-trading

 

FLHfT

 

29.6

 

 

 

 

 

 

 

29.6

 

 

 

 

 

29.6

 

 

Financial liabilities measured at amortized cost

 

FLAC

 

14,387.0

 

 

 

14,387.0

 

 

 

 

 

 

 

 

 

14,950.5

 

 

 

 

 

 

 

 

Amounts recognized in balance sheet in accordance with IAS 39

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Measurement categories and classes:

 

Measurement category in acc. with
IAS 39

 

Carrying amounts
Dec. 31, 2016

 

Face value

 

Amortized cost

 

Acquisition cost

 

Fair value affecting net income

 

Fair value recognized in equity

 

Amounts recognized in balance sheet in acc. with IAS 17/
IAS 28

 

Fair value
Dec. 31, 2016

 

Fair value hierarchy level

in € million

                   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash on hand and deposits at banking institutions

 

LaR

 

1,540.8

 

1,540.8

 

 

 

 

 

 

 

 

 

 

 

1,540.8

 

1

Trade receivables

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Receivables from the sale of properties

 

LaR

 

135.4

 

 

 

135.4

 

 

 

 

 

 

 

 

 

135.4

 

2

Receivables from property letting

 

LaR

 

28.0

 

 

 

28.0

 

 

 

 

 

 

 

 

 

28.0

 

2

Other receivables from trading

 

LaR

 

1.0

 

 

 

1.0

 

 

 

 

 

 

 

 

 

1.0

 

2

Financial assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Joint ventures valued at equity

 

n. a.

 

3.9

 

 

 

 

 

 

 

 

 

 

 

3.9

 

3.9

 

n.a.

Loans to other investments

 

LaR

 

33.5

 

 

 

33.5

 

 

 

 

 

 

 

 

 

55.7

 

2

Other non-current loans

 

LaR

 

4.0

 

 

 

4.0

 

 

 

 

 

 

 

 

 

4.0

 

2

Non-current securities

 

AfS

 

7.4

 

 

 

 

 

 

 

 

 

7.4

 

 

 

7.4

 

1

Other investments

 

AfS

 

504.5

 

 

 

 

 

2.6

 

 

 

501.9

 

 

 

504.5

 

1

Derivative financial assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flow hedges (cross currency swaps)

 

n. a.

 

184.7

 

 

 

 

 

 

 

 

 

 

 

 

 

184.7

 

2

Embedded derivatives

 

FLHfT

 

0.2

 

 

 

 

 

 

 

0.2

 

 

 

 

 

0.2

 

2

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trade payables

 

FLAC

 

140.1

 

 

 

140.1

 

 

 

 

 

 

 

 

 

140.1

 

2

Non-derivative financial liabilities

 

FLAC

 

13,371.0

 

 

 

13,371.0

 

 

 

 

 

 

 

 

 

14,041.0

 

2

Derivative financial liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase price liabilities from put options/rights to reimbursement

 

FLHfT

 

57.2

 

 

 

 

 

 

 

57.2

 

 

 

 

 

57.2

 

3

Other swaps

 

n. a.

 

19.4

 

 

 

 

 

 

 

 

 

 

 

 

 

19.4

 

2

Liabilities from finance leases

 

n. a.

 

99.2

 

 

 

 

 

 

 

 

 

 

 

99.2

 

207.7

 

2

Liabilities to non-controlling interests

 

FLAC

 

12.6

 

 

 

12.6

 

 

 

 

 

 

 

 

 

12.6

 

2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thereof aggregated by measurement categories in accordance with IAS 39:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans and receivables

 

LaR

 

1,742.7

 

1,540.8

 

201.9

 

 

 

 

 

 

 

 

 

1,764.9

 

 

Available-for-sale financial assets

 

AfS

 

511.9

 

 

 

 

 

2.6

 

 

 

509.3

 

 

 

511.9

 

 

Financial liabilities held-for-trading

 

FLHfT

 

57.0

 

 

 

 

 

 

 

57.0

 

 

 

 

 

57.0

 

 

Financial liabilities measured at amortized cost

 

FLAC

 

13,523.7

 

 

 

13,523.7

 

 

 

 

 

 

 

 

 

14,193.7

 

 

Financial assets and financial liabilities not covered by IAS 39 comprise:

  • Employee benefits IAS 19: gross presentation of right to reimbursement arising from transferred pension obligations in the amount of € 6.6 million (Dec. 31, 2016: € 7.0 million).
  • Amount by which the fair value of plan assets exceeds the corresponding obligation: € 1.1 million (Dec. 31, 2016: € 1.1 million).
  • Provisions for pensions and similar obligations: € 505.5 million (Dec.31, 2016: € 522.6 million).

The following table shows the assets and liabilities that are recognized in the balance sheet at fair value and their classification according to the fair value hierarchy:

in € million

 

Jun. 30, 2017

 

Level 1

 

Level 2

 

Level 3

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

Investment properties

 

30,495.7

 

 

 

 

 

30,495.7

Available-for-sale financial assets

 

 

 

 

 

 

 

 

Non-current securities

 

7.8

 

7.8

 

 

 

 

Other investments

 

563.3

 

563.3

 

 

 

 

Assets held for sale

 

 

 

 

 

 

 

 

Investment properties (contract closed)

 

254.1

 

 

 

254.1

 

 

Derivative financial assets

 

 

 

 

 

 

 

 

Cash flow hedges (cross currency swaps)

 

119.9

 

 

 

119.9

 

 

Liabilities

 

 

 

 

 

 

 

 

Derivative financial liabilities

 

 

 

 

 

 

 

 

Purchase price liabilities from put options/rights to reimbursement

 

26.1

 

 

 

 

 

26.1

Cash flow hedges

 

14.5

 

 

 

14.5

 

 

Stand-alone derivatives

 

3.5

 

 

 

3.5

 

 

in € million

 

Dec. 31, 2016

 

Level 1

 

Level 2

 

Level 3

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

Investment properties

 

26,980.3

 

 

 

 

 

26,980.3

Available-for-sale financial assets

 

 

 

 

 

 

 

 

Non-current securities

 

7.4

 

7.4

 

 

 

 

Other investments

 

501.9

 

501.9

 

 

 

 

Assets held for sale

 

 

 

 

 

 

 

 

Investment properties (contract closed)

 

61.6

 

 

 

61.6

 

 

Derivative financial assets

 

 

 

 

 

 

 

 

Cash flow hedges (cross currency swaps)

 

184.9

 

 

 

184.9

 

 

Liabilities

 

 

 

 

 

 

 

 

Derivative financial liabilities

 

 

 

 

 

 

 

 

Purchase price liabilities from put options/rights to reimbursement

 

57.2

 

 

 

 

 

57.2

Cash flow hedges

 

19.1

 

 

 

19.1

 

 

Vonovia measures its investment properties generally on the basis of the discounted cash flow (DCF) methodology (Level 3). The main valuation parameters and valuation results can be found in note [9] Investment Properties.

The investment properties classified as assets held for sale are recognized at the time of their transfer to assets held for sale at their new fair value, the agreed purchase price (Level 2).

No financial instruments were reclassified to different hierarchy levels compared with the comparative period.

Non-current securities are measured using the quoted prices in active markets (Level 1).

For the measurement of financial instruments, cash flows are initially calculated and then discounted. In addition to the tenor-specific EURIBOR rates (3M; 6M), the respective credit risk is taken as a basis for discounting. Depending on the expected cash flows, either Vonovia’s own credit risk or the counterparty risk is taken into account in the calculation. For the consolidated financial statements, Vonovia’s own credit risk was relevant for interest rate swaps. This credit risk is derived for material risks from rates observable on the capital markets and ranges between 20 and 80 basis points, depending on the residual maturities of financial instruments. Regarding the positive market values of the cross currency swaps, a counterparty risk of between 30 and 50 basis points was taken into account.

The calculated cash flows of the cross currency swap result from the forward curve for USD/EUR. The cash flows are discounted on the basis of the reference interest rate of each currency (LIBOR and EURIBOR) and translated into euros at the current exchange rate (Level 2).

The fair value of the purchase price liabilities from put options/rights to reimbursement granted to minority shareholders is generally based on the going concern value of the respective company; if a contractually agreed minimum purchase price is higher than this amount, this purchase price is recognized (Level 3). The unobservable valuation parameters may fluctuate depending on the going concern values of these companies. However, a major change in value is not likely, as the business model is very predictable.

The following table shows the development of the put options recognized at fair value:

 

 

 

 

Change in

 

Change

 

 

in € million

 

As of
Jan. 1

 

Scope of consolidation

 

affecting
net income

 

Cash
effective

 

not affecting net income

 

As of
Jun. 30

 

 

 

 

 

 

 

 

 

 

 

 

 

2017

 

 

 

 

 

 

 

 

 

 

 

 

Purchase price liabilities from put options/rights to reimbursement

 

57.2

 

10.1

 

-14.7

 

 

-26.5

 

26.1

 

 

 

 

Change in

 

Change

 

 

in € million

 

As of
Jan. 1

 

Scope of consolidation

 

affecting
net income

 

Cash
effective

 

not affecting net income

 

As of
Jun. 30

 

 

 

 

 

 

 

 

 

 

 

 

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

Purchase price liabilities from put options/rights to reimbursement

 

57.6

 

6.7

 

-0.4

 

 

-6.7

 

57.2