Mercedes 2013 Annual Report Download - page 201

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F | Consolidated Financial Statements | Notes to the Consolidated Financial Statements
Pension obligations. The calculation of provisions for
pensions and similar obligations and the related pension cost
are based on various mathematical models. The calculations
are subject to various assumptions on matters such as current
actuarially developed probabilities (e.g. discount factors and
cost-of-living increases), future fluctuations with regard to age
and period of service, and experience with the probability
of occurrence of pension payments, annuities or lump sums.
As a result of changed market or economic conditions, the
probabilities on which the influencing factors are based, may
differ from current developments. The financial effects
of deviations of the main factors are calculated with the use
of sensitivity analyses. See Note 22 for further information.
Income taxes. The calculation of income taxes of Daimler AG
and its subsidiaries is based on the legislation and regulations
applicable in the various countries. Due to their complexity, the
tax items presented in the financial statements are possibly
subject to different interpretation by taxpayers on the one hand
and local tax authorities on the other. For the calculation
of deferred tax assets, assumptions have to be made regarding
future taxable income and the time of realization of the
deferred tax assets. In this context, we take into consideration,
among other things, the projected earnings from business
operations, the effects on earnings of the reversal of taxable
temporary differences, and realizable tax strategies. As future
business developments are uncertain and are sometimes
beyond Daimler’s control, the assumptions to be made in connec-
tion with accounting for deferred tax assets are connected
with a substantial degree of uncertainty. On each balance sheet
date, Daimler carries out impairment tests on deferred tax
assets on the basis of the planned taxable income in future
financial years; if Daimler assesses that the probability
of future tax advantages being partially or fully unrealized
is more than 50%, the deferred tax assets are impaired.
Further information is provided in Note 9.
3. Significant acquisitions and dispositions of interests in
companies and of other assets and liabilities
Acquisitions
BAIC Motor. In 2013, BAIC Motor Corporation Ltd. (BAIC
Motor) issued new shares to Daimler representing a 12% equity
interest for a price of €627 million (including transaction
costs). The investment in BAIC Motor is presented in the consoli-
dated financial statements according to the equity method.
At the same time, BAIC Motor increased its share of the joint
venture Beijing Benz Automotive Co., Ltd. (BBAC) by 1%
to 51%; Daimler increased its share of the jointly owned sales
company Beijing Mercedes-Benz Sales Service Co., Ltd.
also by 1% to 51%. See Notes 13 and 36 for further information
on these transactions.
Disposals
EADS. The disposal of our shareholding in the European
Aeronautic Defence and Space Company EADS N.V.
(since January 2, 2014: Airbus Group N.V.) and the loss of signi-
ficant influence on that company is explained in Note 13.
MBtech Group. In December 2011, Daimler and AKKA
Technologies SA signed a contract on the sale of a 65% interest
in the former Daimler subsidiary MBtech Group GmbH & Co.
KGaA (MBtech Group). The transaction was concluded on April 12,
2012 and resulted in a cash inflow of €48 million and a
gain before income taxes of €10 million in 2012. These amounts
are primarily allocated to the Mercedes-Benz Cars segment.
The remaining equity interest in MBtech Group is accounted for
using the equity method. At the time of the transaction, the
assets and liabilities of MBtech Group amounted to €85 million
and €78 million respectively; the total amount of assets
included cash and cash equivalents of €8 million.