Annual Report 2013

Other disclosures

(36) Consolidated statement of cash flows

We prepare the consolidated statement of cash flowscash flows
Inflows and outflows of cash and cash equivalents divided within the statement of cash flows into cash flows from ordinary activities, from investing and acquisition activities, and from financing activities.
in accordance with International Accounting Standard (IAS) 7 “Statements of Cash FlowsCash Flows
Inflows and outflows of cash and cash equivalents divided within the statement of cash flows into cash flows from ordinary activities, from investing and acquisition activities, and from financing activities.
.” It describes the flow of cash and cash equivalents by origin and usage of liquid funds. It distinguishes between changes in funds arising from operating activities, investing activities, and financing activities. Financial funds include cash on hand, checks and credit at banks, and other financial assets with a remaining term of not more than three months. Securities are therefore included in financial funds, provided that they are available at short term and are only exposed to an insignificant price change risk. The computation is adjusted for effects arising from currency translation. In some countries, there are administrative hurdles to the transfer of money to the parent company. The assets held for sale of our companies in Iran that are classified as available for sale include cash and cash equivalents of 10 million euros that cannot be transferred to the parent company at present.

Cash flowsCash flows
Inflows and outflows of cash and cash equivalents divided within the statement of cash flows into cash flows from ordinary activities, from investing and acquisition activities, and from financing activities.
from operating activities are determined by initially adjusting operating profit by non-cash variables such as amortization/ depreciation/impairmentimpairment
Impairments of assets are recorded when the recoverable amount is lower than the carrying amount at which the asset is recognized in the statement of financial position. The recoverable amount is calculated as the higher of fair value less costs to sell (net realizable value) and value in use.
/write-ups on intangible assets and property, plant and equipment – supplemented by changes in provisions, changes in other assets and liabilities, and also changes in net working capitalnet working capital
Inventories plus payments on account, receivables from suppliers and trade accounts receivable, less trade accounts payable, liabilities to customers and current sales provisions.
. We disclose payments made for income taxes under operating cash flowcash flow
Inflows and outflows of cash and cash equivalents divided within the statement of cash flows into cash flows from ordinary activities, from investing and acquisition activities, and from financing activities.
.

Cash flowsCash flows
Inflows and outflows of cash and cash equivalents divided within the statement of cash flows into cash flows from ordinary activities, from investing and acquisition activities, and from financing activities.
from investing activities occur essentially as a result of outflows of funds for investments in intangible assets and property, plant and equipment, subsidiaries and other business units, as well as investments accounted for at equity and joint ventures. We also recognize inflows of funds from the sale of intangible assets and property, plant and equipment, subsidiaries and other business units here. In the reporting period, cash flowscash flows
Inflows and outflows of cash and cash equivalents divided within the statement of cash flows into cash flows from ordinary activities, from investing and acquisition activities, and from financing activities.
from investing activities mainly involved outflows for investments in intangible assets and property, plant and equipment in the amount of –436 million euros (previous year: –422 million euros). Outflows for the acquisition of subsidiaries and other business units in the amount of –31 million euros (previous year: –113 million euros) and inflows from the sale of subsidiaries and other business units in the amount of 24 million euros (previous year: 3 million euros) relate to the acquisitions and divestments described in the section here (“Acquisitions and divestments”).

In cash flowscash flows
Inflows and outflows of cash and cash equivalents divided within the statement of cash flows into cash flows from ordinary activities, from investing and acquisition activities, and from financing activities.
from financing activities, we recognize interest and dividends paid and received, the change in borrowings and in pension provisions, and also payments made for the acquisition of non-controlling interestsnon-controlling interests
Proportion of equity attributable to third parties in subsidiaries included within the scope of consolidation. Previously termed “minority interests.” Valued on a proportional net asset basis. A pro-rata portion of the net earnings of a corporation is due to shareholders owning non-controlling interests.
and other financing transactions. The change in borrowings in the reporting year was significantly affected by the redemption of our senior bond in June 2013.

Free cash flowFree cash flow
Cash flow actually available for acquisitions, dividend payments, the reduction of borrowings and contributions to pension funds.
shows how much cash is actually available for acquisitions and dividends, reducing debt and/or contributions to pension funds.