30 Noncurrent and current other provisions

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€ million

 

Obligations arising from sales

 

Employee expenses

 

Litigation and legal risks

 

Miscellaneous provisions

 

Total

 

 

 

 

 

 

 

 

 

 

 

Balance at Jan. 1, 2015

 

20,539

 

4,091

 

1,306

 

7,049

 

32,986

Foreign exchange differences

 

214

 

−19

 

−143

 

32

 

83

Changes in consolidated Group

 

0

 

0

 

0

 

1

 

2

Utilized

 

7,517

 

1,429

 

236

 

1,901

 

11,082

Additions/New provisions

 

19,270

 

1,668

 

7,697

 

2,747

 

31,382

Unwinding of discount/effect of change in discount rate

 

5

 

−22

 

4

 

4

 

−9

Reversals

 

1,185

 

142

 

219

 

858

 

2,404

Balance at Dec. 31, 2015

 

31,326

 

4,148

 

8,409

 

7,075

 

50,958

of which current

 

17,075

 

1,733

 

2,073

 

4,908

 

25,788

of which noncurrent

 

14,251

 

2,415

 

6,336

 

2,168

 

25,170

Balance at Jan. 1, 2016

 

31,326

 

4,148

 

8,409

 

7,075

 

50,958

Foreign exchange differences

 

174

 

35

 

93

 

100

 

402

Changes in consolidated Group

 

23

 

1

 

3

 

124

 

151

Utilized

 

9,265

 

1,344

 

1,583

 

2,103

 

14,295

Additions/New provisions

 

12,180

 

1,736

 

5,605

 

3,419

 

22,939

Unwinding of discount/effect of change in discount rate

 

123

 

196

 

−84

 

3

 

238

Reversals

 

1,533

 

227

 

726

 

713

 

3,199

Balance at Dec. 31, 2016

 

33,027

 

4,546

 

11,717

 

7,904

 

57,193

of which current

 

19,521

 

1,900

 

8,624

 

5,666

 

35,711

of which noncurrent

 

13,506

 

2,646

 

3,092

 

2,238

 

21,482

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.

The change in the provisions for litigation and legal risks is largely the result of provisions recognized to protect against the currently known legal risks related to the diesel issue, including suitable expenses for defense and legal advice, as well as provisions for the antitrust proceedings that the European Commission opened in 2011 against European truck manufacturers including MAN and Scania. These are subject to what are in part considerable estimation risks because the comprehensive and extensive investigations are still at an early stage, the factors involved are so complex, and the discussions with the authorities are still ongoing. In addition, the provisions for litigation and legal risks contain amounts relating 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. The increase results from provisions of €0.3 billion recognized for the investments totaling USD 2.0 billion over 10 years in zero emissions vehicle infrastructure as well as corresponding access and awareness initiatives for these technologies to which the Volkswagen Group had committed itself in the settlement agreements.

Miscellaneous provisions additionally include provisions amounting to €490 million (previous year: €459 million) relating to the insurance business.