Other Disclosures

41. FURTHER DISCLOSURES ON FINANCIAL INSTRUMENTS

Financial Instruments by Class and Measurement Category as at 31 December 2018

Carrying amounts by class and measurement category
in million €Carrying amount
31 Dec. 2018
Carrying amount pursuant to IFRS 9Carrying amount
pursuant to IAS 17
Amortised costFair value
through other comprehensive income
Fair value
through profit or loss
ASSETS - Financial assets
Other financial assets1,291.51,183.342.365.90.0
Other receivables from suppliers911.6911.60.00.00.0
Loans262.7262.70.00.00.0
Shareholder loans to partner companies47.10.00.047.10.0
Receivables from derivative financial instruments32.80.026.66.20.0
Derivatives not included in hedge accounting6.20.00.06.20.0
Derivatives with hedging relationship*26.60.026.60.00.0
Shares in corporations and other securities26.00.015.710.30.0
Interest in partnerships2.30.00.02.30.0
Other financial assets9.09.00.00.00.0
Trade receivables1,400.61.400,60.00.00.0
Cash and cash equivalents639.2639.20.00.00.0
LIABILITIES - financial liabilities
Other financial liabilities2,799.81,926.114.74.6854.4
Liabilities to banks1,442.91,442.90.00.00.0
Liabilities from finance leases*854.40.00.00.0854.4
Liabilities from derivative financial instruments19.30.014.74.60.0
Derivatives not included in hedge accounting4.60.00.04.60.0
Derivatives with hedging relationship*14.70.014.70.00.0
Other financial liabilities483.2483.20.00.00.0
Trade payables6,850.66,850.60.00.00.0
  • * Not a measurement category pursuant to IFRS 9

Financial Instruments by Class and Measurement Category as at 31 December 2017

The classes of financial instruments were based on the structure of the balance sheet.

Reconciliation of the Individual Classes and Measurement Categories of IAS 39 to the Balance Sheet Items
in million €Carrying amount
31 Dec. 2017
Carrying amount pursuant to IAS 39Carrying amount pursuant to IAS 17
(Amortised) costFair value recognised
directly in equity
Fair value through
profit and loss
ASSETS
Non-current financial assets283.1263.919.20.00.0
Financial assets available for sale107.187.919.20.00.0
Loans and receivables176.0176.00.00.00.0
Current financial assets681.5656.38.816.40.0
Financial assets held for trading15.30.00.015.30.0
Financial assets available for sale0.10.10.00.00.0
Loans and receivables656.2656.20.00.00.0
Financial assets in hedge accounting*9.90.08.81.10.0
Current trade receivables1,262.41,262.40.00.00.0
Loans and receivables1,262.41,262.40.00.00.0
Cash and cash equivalents653.4653.40.00.00.0
Loans and receivables653.4653.40.00.00.0
Total ASSETS2,880.42,836.028.016.40.0
LIABILITIES
Non-current financial liabilities1,209.0372.40.00.0836.6
Other financial liabilities372.4372.40.00.00.0
Liabilities from finance leases*836.60.00.00.0836.6
Non-current trade payables6.96.90.00.00.0
Other financial liabilities6.96.90.00.00.0
Current financial liabilities1,188.61,089.019.017.563.1
Financial liabilities held for trading15.00.00.015.00.0
Other financial liabilities1,089.01,089.00.00.00.0
Financial liabilities in hedge accounting*21.50.019.02.50.0
Liabilities from finance leases*63.10.00.00.063.1
Current trade payables6,153.26,153.20.00.00.0
Other financial liabilities6,153.26,153.20.00.00.0
Total LIABILITIES8,557.77,621.519.017.5899.7
Of which: aggregated by measurement categories pursuant to IAS 39:     
Financial assets held for trading15.30.00.015.30.0
Financial assets available for sale107.288.019.20.00.0
Loans and receivables2,748.02,748.00.00.00.0
Financial liabilities held for trading15.00.00.015.00.0
Other financial liabilities7,621.57,621.50.00.00.0
Of which: in hedge accounting pursuant to IAS 39:     
Financial assets in hedge accounting9.90.08.81.10.0
Financial liabilities in hedge accounting21.50.019.02.50.0
  • * Not a measurement category pursuant to IFRS 9

The classification and measurement requirements of IFRS 9 have been applied since 1 January 2018. The corresponding reconciliation of the classes to the balance sheet items from 31 December 2017 to 1 January 2018 are presented in note 2 "Application and Effects of New or Revised Accounting Standards".

IFRS 7 requires financial instruments measured at fair value to be assigned to a fair value hierarchy. There are three hierarchy levels. Level 1 comprises financial instruments whose fair values can be derived from quoted prices. Level 2 comprises financial instruments whose fair values cannot be derived from quoted prices, but whose measurement-related inputs are directly or indirectly observable on the market. Financial instruments that cannot be assigned to either level 1 or level 2 are assigned to level 3. Fair value in this case is determined using factors that are not based on observable market data.

Shares in corporations and other securities include securities amounting to 15.7 million euros that are measured at fair value. They are assigned to level 1. These measurement effects recognised in other comprehensive income are not reclassified to the income statement upon subsequent disposal of the equity instrument. These are strategic financial investments. The groups consider the option to measure them at fair value through other comprehensive income to be more meaningful.

This relates to the following shares:

  • DZ BANK AG Deutsche Zentral-Genossenschaftsbank, Frankfurt am Main (fair value as at 31 December 2018: 11.9 million euros),

  • home24 SE, Berlin (fair value as at 31 December 2018: 3.8 million euros).

In the financial year, some of the shares in DZ BANK AG Deutsche Zentral-Genossenschaftsbank were sold at their fair value of 11.2 million because this financial investment was no longer in line with the groups' investment strategy.

The assets and liabilities from derivative financial instruments, which include interest rate swaps, currency derivatives and commodities derivatives, are measured at fair value and assigned to level 2 of the fair value hierarchy.

The remaining financial assets, which are recognised at fair value, are measured using established valuation techniques and are assigned to level 3 of the fair value hierarchy. There were no material measurement effects as at 31 December 2018.

Fair Value Disclosures

Comparison of the Carrying Amounts and Fair Values of the Financial Instruments for Each Class
in million €31/12/201831/12/2017
Carrying amountFair valueCarrying amountFair value
ASSETS
Non-current234.4235.0283.1284.3
Non-current other financial assets234.4235.0283.1284.3
Current3,096.93,097.22,597.32,597.6
Current other financial assets1,057.11,057.4681.5681.8
Current trade receivables1,400.61,400.61,262.41,262.4
Cash and cash equivalents639.2639.2653.4653.4
LIABILITIES
Non-current2,113.62,214.71,215.91,251.7
Other non-current financial liabilities2,104.52,205.61,209.01,244.8
Non-current trade payables9.19.16.96.9
Current7,536.87,537.27,341.87,345.8
Other current financial liabilities695.3695.71,188.61,192.6
Current trade payables6,841.56,841.56,153.26,153.2

Due to the short remaining maturities, the carrying amounts of current trade receivables and trade payables as well as of cash and cash equivalents approximate their fair values.

Non-current trade receivables and trade payables are discounted to present value. In this case, the carrying amounts largely reflect the fair values.

Market prices are generally used to measure other financial assets and liabilities. In the absence of a market price, the approved discounted cash flow methods are used to calculate fair value. The valuation model is based on the yield curves and exchange rates that apply on the balance sheet date.

Net Result from Financial Instruments

Breakdown of Income and Expenses from Financial Instruments in Accordance with IFRS 9 Measurement Categories
Income (+)/expenses (-)
in million €
2018
 
2017
 
Financial assets at amortised cost39.538.5
Financial assets and liabilities measured at fair value-6.6-17.5
Financial liabilities at amortised cost-102.9-70.8

Income on financial assets measured at amortised cost primarily includes exchange rate gains and losses as well as income from previously impaired receivables. Impairment losses on financial receivables had an offsetting effect within this item. The result of financial assets and liabilities measured at fair value includes the result from the measurement of derivative financial instruments and income from equity investments. In the previous year, equity investments were measured at cost and recognised at amortised cost under financial assets. Expenses from financial liabilities measured at amortised cost primarily include interest expenses and exchange gains and losses.

Interest income on financial instruments not measured at fair value through profit or loss amounted to 5.9 million euros (previous year: 6.3 million euros), while corresponding interest expenses amounted to 21.0 million euros (previous year: 28.2 million euros).