Notes

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30 Noncurrent and current other provisions

€ million

 

Obligations arising from sales

 

Employee expenses

 

Litigation and legal risks

 

Miscel­laneous provisions

 

Total

 

 

 

 

 

 

 

 

 

 

 

Balance at Jan. 1, 2020

 

26,988

 

5,993

 

5,260

 

7,976

 

46,217

Foreign exchange differences

 

–653

 

–56

 

–170

 

–222

 

–1,101

Changes in consolidated Group

 

18

 

16

 

0

 

522

 

556

Utilization

 

9,625

 

2,275

 

2,347

 

2,086

 

16,333

Additions/New provisions

 

10,890

 

2,707

 

1,781

 

4,393

 

19,771

Unwinding of discount/effect of change in discount rate

 

17

 

108

 

–20

 

0

 

105

Reversals

 

1,637

 

223

 

586

 

1,117

 

3,564

Balance at Dec. 31, 2020

 

25,998

 

6,270

 

3,918

 

9,465

 

45,652

of which current

 

12,394

 

2,174

 

2,037

 

6,359

 

22,964

of which noncurrent

 

13,604

 

4,096

 

1,881

 

3,107

 

22,688

Balance at Jan. 1, 2021

 

25,998

 

6,270

 

3,918

 

9,465

 

45,652

Foreign exchange differences

 

526

 

54

 

60

 

211

 

851

Changes in consolidated Group

 

408

 

38

 

972

 

174

 

1,592

Classified as held for sale

 

2

 

26

 

 

0

 

28

Utilization

 

9,274

 

1,870

 

1,259

 

2,606

 

15,009

Additions/New provisions

 

10,997

 

2,783

 

2,120

 

4,503

 

20,403

Unwinding of discount/effect of change in discount rate

 

–71

 

–133

 

7

 

16

 

–181

Reversals

 

2,272

 

278

 

599

 

1,078

 

4,227

Balance at Dec. 31, 2021

 

26,310

 

6,837

 

5,220

 

10,685

 

49,052

of which current

 

11,754

 

2,784

 

3,389

 

7,651

 

25,578

of which noncurrent

 

14,555

 

4,053

 

1,831

 

3,035

 

23,474

The obligations arising from sales contain provisions covering all risks relating to the sale of vehicles, components and genuine parts through to the disposal of end-of-life vehicles. They primarily comprise warranty obligations, calculated on the basis of losses to date and estimated future losses. They also include provisions for discounts, bonuses and similar allowances which are incurred after the balance sheet date, but for which there is a legal or constructive obligation attributable to sales revenue before the balance sheet date.

Provisions for employee expenses are recognized for long-service awards, time credits, partial retirement arrangements, severance payments and similar obligations, among other things.

In addition to residual provisions relating to the diesel issue, the provisions for litigation and legal risks contain amounts related to a large number of legal disputes and official proceedings in which Volkswagen Group companies become involved in Germany and internationally in the course of their operating activities. In particular, such legal disputes and other proceedings may occur in relation to suppliers, dealers, customers, employees, or investors. Please refer to the “Litigation” section for a discussion of the legal risks.

Miscellaneous provisions relate to a wide range of identifiable specific risks, price risks and uncertain obligations, which are measured in the amount of the expected settlement value. Depending the jurisdiction concerned, they also include risk provisions for any non-compliance with legal emissions limits. Their measurement takes into account, among other things, the respective sales volume and the legally defined fee or the cost of acquiring emission rights from other manufacturers. Advantage has been taken of synergies between individual brands of the Volkswagen Group by establishing emission pools where possible.

Miscellaneous provisions additionally include provisions amounting to €1,527 million (previous year: €1,265 million) relating to the insurance business.