36 Cash flow statement

Cash flows are presented in the cash flow statement classified into cash flows from operating activities, investing activities and financing activities, irrespective of the balance sheet classification.

Cash flows from operating activities are derived indirectly from earnings before tax. Earnings before tax are adjusted to eliminate noncash expenditures (mainly depreciation, amortization and impairment losses) and income. Other noncash income and expense results mainly from measurement effects in connection with financial instruments and to fair value changes relating to hedging transactions. This results in cash flows from operating activities after accounting for changes in working capital, which also include changes in lease assets and in financial services receivables.

Investing activities include additions to property, plant and equipment and equity investments, additions to capitalized development costs and investments in securities, loans and time deposits.

Financing activities include outflows of funds from dividend payments and redemption of bonds, inflows from the capital increases and issuance of bonds, and changes in other financial liabilities. Please refer to the “Equity” section for information on the in-/outflows from the issuance/repayment of hybrid capital contained in the capital contributions.

The changes in balance sheet items that are presented in the cash flow statement cannot be derived directly from the balance sheet, as the effects of currency translation and changes in the consolidated Group are noncash transactions and are therefore eliminated.

In the fiscal year, cash flows from operating activities include interest received amounting to €7,640 million (previous year: €7,047 million) and interest paid amounting to €2,604 million (previous year: €1,857 million). Cash flows from operating activities also include dividend payments (net of withholding tax) received from joint ventures and associates of €3,679 million (previous year: €3,315 million).

Dividends amounting to €2,419 million (previous year: €1,967 million) were paid to Volkswagen AG shareholders.

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€ million

 

Dec. 31, 2019

 

Dec. 31, 2018

 

 

 

 

 

Cash, cash equivalents and time deposits as reported in the balance sheet

 

25,923

 

28,938

Time deposits

 

−1,593

 

−825

Cash and cash equivalents as reported in the cash flow statement

 

24,329

 

28,113

Time deposits are not classified as cash equivalents. Time deposits have a contractual maturity of more than three months. The maximum default risk corresponds to its carrying amount.

The following table shows the classification of changes in financial liabilities into cash and non-cash transactions:

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NON-CASH CHANGES

 

 

€ million

 

Jan. 1, 2018

 

Cash-effective changes

 

Foreign exchange differences

 

Changes in consolidated Group

 

Other changes

 

Dec. 31, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

Bonds

 

63,118

 

20,018

 

−193

 

 

−1,395

 

81,549

Other total third-party borrowings

 

99,875

 

7,740

 

−414

 

11

 

1,674

 

108,886

Finance lease liabilities

 

479

 

−29

 

−1

 

 

0

 

449

Total third-party borrowings

 

163,472

 

27,730

 

−607

 

11

 

279

 

190,883

Put options and compensation rights granted to noncontrolling interest shareholders

 

3,795

 

−2,132

 

 

 

190

 

1,853

Other financial assets and liabilities

 

−160

 

−121

 

27

 

 

72

 

−182

Financial assets and liabilities in financing activities

 

167,107

 

25,477

 

−581

 

11

 

541

 

192,555

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NON-CASH CHANGES

 

 

€ million

 

Jan. 1, 2019

 

Cash-effective changes

 

Foreign exchange differences

 

Changes in consolidated Group

 

Classified as held for sale

 

Other changes

 

Dec. 31, 2019

1

Value in the opening balance adjusted (see disclosures on IFRS 16).

2

Other changes in lease liabilities largely contain noncash additions of lease liabilities.

3

Other changes in put options/compensation rights granted to noncontrolling interest shareholders largely contain the reclassification of the residual liability to equity after the put options granted expired in the fiscal year.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bonds

 

81,549

 

6,132

 

496

 

 

 

452

 

88,629

Other total third-party borrowings

 

108,886

 

−3,392

 

1,616

 

−193

 

0

 

−287

 

106,630

Finance lease liabilities1,2

 

5,567

 

−957

 

81

 

16

 

9

 

1,513

 

6,210

Total third-party borrowings

 

196,001

 

1,783

 

2,193

 

−177

 

9

 

1,678

 

201,468

Put options and compensation rights granted to noncontrolling interest shareholders³

 

1,853

 

−1,135

 

 

 

 

−718

 

Other financial assets and liabilities

 

−182

 

18

 

−3

 

 

 

87

 

−81

Financial assets and liabilities in financing activities

 

197,672

 

666

 

2,189

 

−177

 

9

 

1,046

 

201,387