16 Other provisions
millions of € |
|
|
|
|
|
|
|
|
|---|---|---|---|---|---|---|---|---|
|
Provisions for termination benefits |
Other provisions for personnel costs |
Provisions for restoration obligations |
Provisions for litigation risks |
Provisions for sales and procurement support |
Miscellaneous other provisions |
Total |
|
At December 31, 2019 |
160 |
3,361 |
1,707 |
284 |
466 |
685 |
6,663 |
|
Of which: current |
159 |
1,694 |
31 |
261 |
466 |
471 |
3,082 |
|
Transfer resulting from changes in accounting standards |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
|
Changes in the composition of the Group |
81 |
490 |
1,016 |
234 |
67 |
20 |
1,907 |
|
Currency translation adjustments |
(21) |
(99) |
(170) |
(24) |
(24) |
(9) |
(348) |
|
Addition |
251 |
2,625 |
288 |
119 |
605 |
294 |
4,183 |
|
Use |
(47) |
(1,930) |
(67) |
(231) |
(507) |
(192) |
(2,974) |
|
Reversal |
(122) |
(307) |
(59) |
(61) |
(50) |
(92) |
(690) |
|
Interest effect |
0 |
397 |
100 |
(3) |
0 |
1 |
494 |
|
Other changes |
0 |
(155) |
(35) |
(2) |
0 |
(9) |
(202) |
|
At December 31, 2020 |
302 |
4,382 |
2,778 |
317 |
557 |
697 |
9,033 |
|
Of which: current |
302 |
1,992 |
46 |
288 |
557 |
454 |
3,638 |
|
Transfer resulting from changes in accounting standards |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
|
Changes in the composition of the Group |
0 |
0 |
29 |
27 |
0 |
7 |
64 |
|
Currency translation adjustments |
4 |
93 |
126 |
7 |
18 |
8 |
257 |
|
Addition |
38 |
2,830 |
452 |
143 |
491 |
266 |
4,220 |
|
Use |
(113) |
(1,830) |
(265) |
(54) |
(483) |
(181) |
(2,926) |
|
Reversal |
(199) |
(316) |
(53) |
(38) |
(25) |
(98) |
(729) |
|
Interest effect |
0 |
(220) |
(45) |
2 |
0 |
0 |
(264) |
|
Other changes |
100 |
(224) |
(32) |
0 |
0 |
(36) |
(192) |
|
At December 31, 2021 |
133 |
4,714 |
2,990 |
405 |
558 |
663 |
9,463 |
|
Of which: current |
47 |
2,260 |
236 |
381 |
558 |
420 |
3,903 |
|
In the measurement of the other provisions, Deutsche Telekom is exposed to interest rate fluctuations, which is why the effect of a possible change in the interest rate on the principal non-current provisions was simulated. The other, non-staff-related provisions are discounted using maturity-related discount rates specific to the respective currency area. To this end, Deutsche Telekom determines discount rates with maturities of up to 30 years. In 2021, the discount rates ranged from 0.00 to 1.59 % (2020: from 0.00 to 1.21 %) in the euro currency area and from 1.14 to 4.14 % (2020: from 0.78 to 3.61 %) in the U.S. dollar currency area. If the discount rate were increased by 50 basis points with no other change in the assumptions, the present value of the principal other non-current provisions would decrease by EUR 159.5 million (December 31, 2020: EUR 123.2 million). If the discount rate were decreased by 50 basis points with no other change in the assumptions, the present value of the principal other non-current provisions would increase by EUR 173.8 million (December 31, 2020: EUR 126.2 million).
The carrying amount of current and non-current other provisions increased by EUR 0.4 billion compared with December 31, 2020 to EUR 9.5 billion.
Provisions for termination benefits and other personnel provisions include, among other components, provisions for staff restructuring. These have developed as follows in the 2021 financial year:
millions of € |
|
|
|
|
|
|
|
|
|---|---|---|---|---|---|---|---|---|
|
Jan. 1, 2021 |
Changes in the composition of the Group |
Addition |
Use |
Reversal |
Other changes |
|
|
Severance and voluntary redundancy models |
302 |
0 |
38 |
(113) |
(199) |
104 |
133 |
|
Phased retirement |
866 |
0 |
700 |
(469) |
(2) |
(94) |
1,001 |
|
|
1,168 |
0 |
738 |
(582) |
(201) |
10 |
1,134 |
|
Of which: current |
553 |
|
|
|
|
|
315 |
|
Within provisions for termination benefits, provisions were reduced by, among other factors, the reversal of other provisions for personnel costs of EUR 0.1 billion, which had been recognized by OTE in 2010 and 2011 for an additional payment to the Greek social insurance fund IKA-ETAM, as a result of proceedings concluded in September 2021.
Other personnel provisions increased by EUR 0.3 billion, which was attributable, in part, to short-term variable remuneration, phased retirement, and vacation. By contrast, the provisions recognized for the Civil Service Health Insurance Fund (Postbeamtenkrankenkasse – PBeaKK) decreased by EUR 0.1 billion, which is mainly attributable to the subsequent measurement of the present value determined using actuarial principles (interest effect). Other provisions for personnel costs also include provisions for deferred compensation and allowances, as well as for anniversary gifts.
The provisions for restoration obligations increased by EUR 0.2 billion. These include the estimated costs for dismantling and removing assets, and restoring the sites on which they are located. The estimated costs are included in the costs of the relevant assets. The provisions for litigation risks primarily relate to possible settlements attributable to pending lawsuits. Provisions for sales and procurement support are recognized for dealer commissions, market development funds (advertising subsidies and refunds). Miscellaneous other provisions include a large number of low-value individual items, such as provisions related to executory contracts, the disposal of businesses and site closures, in particular in prior financial years, as well as warranty and environmental damage provisions.
For further information on litigation risks from pending lawsuits, please refer to Note 37 “Contingencies.”