The following accounting policies were applied essentially unchanged for the preparation of the annual financial statements.
Receivables and other assets are reported at their nominal value. Credit risks are taken into account through recognition of specific loss allowances, wherever necessary.
Cash at banks is recognized at its nominal value.
Financial assets that are immune from access by all other creditors and that serve exclusively to meet post-employment benefit obligations are measured at fair value and netted against provisions for pensions and similar obligations.
Equity is recognized at nominal value.
Reinsurance cover for pension provisions is recognized using the asset values of the overall claims reported by the insurance companies. In this respect, the asset value corresponds both to the amortized costs (payments receives plus accumulated interest and surplus credits) and the fair value as of the reporting date. The fair value of the fund units in the premium deposit account is determined at market prices at the reporting date.
Pension provisions are measured according to the projected unit credit method using the 2018 G (previous year: 2018 G) mortality tables issued by Prof. Dr. Klaus Heubeck. If at the reporting date there is a match between the insurance benefits paid and the accrued pension benefits, pension provisions are recognized in the amount of the carrying amount of the corresponding pension liability claims from life insurance policies (“primacy of the assets side”). The average market interest rate, which is calculated for an assumed residual term of 15 years, is used as a standard basis for discounting.
In accordance with Section 246 (2) sentence 2 HGB, these are netted against the present value of the pension obligations under provisions for pensions and similar obligations in the previous year. In the reporting year, the fair value of reinsurance cover is reported under excess of plan assets over pension liability because, at the reporting date, the fair value of reinsurance cover exceeds the present value of pension obligations.
The actuarial valuation was based on the following parameters:
|
|
Pensions |
|---|---|---|
Discount rate |
|
1.9% |
Expected development of wages and salaries |
|
2.3% |
Expected pension increases |
|
2.3% |
The provisions are recognized at the settlement amount required to cover all identifiable risks and uncertain liabilities on the basis of prudent business judgment.
Long-term provisions with a residual term of more than one year are discounted using the average market interest rate for matching maturities based on the past seven years, as published by the Deutsche Bundesbank. Long-term provisions for pension obligations with a residual term of more than one year are discounted using the average market interest rate for matching maturities based on the past ten years, as published by the Deutsche Bundesbank.
Liabilities are recognized at their settlement amounts.
Any differences between the carrying amounts of assets, liabilities and prepaid expenses according to commercial law and their tax carrying amounts that are expected to be reversed in subsequent financial years are measured at the tax rates applicable to the individual companies in the period in which the difference is reversed, and the resulting tax burden or relief is recognized as deferred taxes.
The measurement of deferred tax assets depends on the estimation of the probability of the reversal of the measurement differences and the utilization of the loss carryforwards which resulted in deferred tax assets. This is dependent upon the generation of future taxable profits during the periods in which the corresponding tax measurement differences are reversed.
The option of recognizing deferred tax assets pursuant to Section 274 (1) sentence 2 HGB has been applied. Deferred taxes are offset and not discounted.