Provisions (Rückstellungen) must be established
Provisions (Rückstellungen) must be established for contingent
liabilities if there is a reasonable expectation that a liability will
materialize in the future.
In particular, provisions are required for
anticipated guarantee and warranty costs. General and specifc
allowances (Wertberichtigungen) may be recognized for the gen-
eral risk of non-collection and for specifc doubtful debts. A pen-
sion provision must be recognized if the employer’s obligation to
make pension payments is documented in a written promise and
the employee has a legal right to one-time or periodic pension
benefits. Pension claims are generally vested and not contingent
on the employee’s continuing in the service of the employer if
the employee is more than 30 years old and the pension promise
has been in existence for at least five years.
The pension provi-
sion must be actuarially calculated annually for each employee
using an interest rate of 6.0%.
EU Forecast
euf:ba18f:199/nws-01