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, 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 |
|
Transfer resulting from changes in accounting standards |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
|
Changes in the composition of the Group |
0 |
(1) |
0 |
0 |
0 |
0 |
(1) |
|
Currency translation adjustments |
3 |
39 |
105 |
5 |
7 |
6 |
165 |
|
Addition |
95 |
2,428 |
757 |
359 |
708 |
619 |
4,965 |
|
Use |
(130) |
(2,008) |
(997) |
(63) |
(515) |
(303) |
(4,017) |
|
Reversal |
(3) |
(215) |
(153) |
(123) |
(10) |
(72) |
(577) |
|
Interest effect |
0 |
(825) |
(166) |
2 |
0 |
(1) |
(990) |
|
Other changes |
0 |
(97) |
(675) |
(2) |
0 |
(31) |
(805) |
|
At December 31, 2022 |
97 |
4,034 |
1,861 |
582 |
749 |
881 |
8,204 |
|
Of which: current |
51 |
2,156 |
272 |
556 |
749 |
629 |
4,412 |
|
The carrying amount of current and non-current other provisions decreased by EUR 1.3 billion compared with December 31, 2021 to EUR 8.2 billion, due in particular to the significant rise in interest rate levels in the reporting year. By contrast, exchange rate effects, primarily from the translation from U.S. dollars into euros, increased the carrying amount. Other provisions developed as follows:
Provisions for termination benefits and other provisions for personnel costs include, among other components, provisions for staff restructuring. These have developed as follows in the 2022 financial year:
millions of € |
|
|
|
|
|
|
|
|
|---|---|---|---|---|---|---|---|---|
|
Jan. 1, 2022 |
Changes in the composition of the Group |
Addition |
Use |
Reversal |
Other changes |
Dec. 31, 2022 |
|
Severance and voluntary redundancy models |
133 |
0 |
95 |
(130) |
(3) |
3 |
97 |
|
Phased retirement |
1,001 |
0 |
722 |
(516) |
(2) |
(201) |
1,005 |
|
|
1,134 |
0 |
817 |
(646) |
(5) |
(198) |
1,102 |
|
Of which: current |
315 |
|
|
|
|
|
341 |
|
Other provisions for personnel costs declined by EUR 0.7 billion, mainly due to a decrease of EUR 0.5 billion in the carrying amount of the provision recognized for the Civil Health Insurance Fund (Postbeamtenkrankenkasse – PBeaKK). This is primarily due to a significant increase in the interest rate level. In addition, the provisions for leave not taken and performance-related remuneration components declined. Other provisions for personnel costs also include provisions for deferred compensation and allowances, as well as for anniversary gifts.
The provisions for restoration obligations decreased by EUR 1.1 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 decrease is mainly attributable to reclassifications to liabilities directly associated with non-current assets and disposal groups held for sale, in particular as a result of the agreed sale of the GD tower companies. The decrease also resulted from the increase in the interest rate level.
By contrast, the provisions for litigation risks increased by a net amount of EUR 0.2 billion, mainly in connection with the proceedings pending in consequence of the cyberattack on T‑Mobile US in August 2021. The provisions for litigation risks primarily relate to possible settlements attributable to pending lawsuits.
Provisions for sales and procurement support increased by EUR 0.2 billion. These provisions are recognized for dealer commissions and market development funds (advertising subsidies, and refunds).
Miscellaneous other provisions increased by EUR 0.2 billion. They 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 39 “Contingencies.”
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 2022, the discount rates ranged from 2.69 to 3.93 % (2021: from 0.00 to 1.59 %) in the euro currency area and from 5.20 to 6.78 % (2021: from 1.14 to 4.14 %) 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 49 million (December 31, 2021: EUR 160 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 50 million (December 31, 2021: EUR 174 million).