7. Financial instruments

7.1 Carrying amounts in accordance with IFRS 9

In accordance with IFRS 9 or IFRS 16, the carrying amounts of financial assets and liabilities are grouped into classes or measurement categories as follows:

The positive and negative long-term and short-term market values of the balance sheet item “Derivative financial instruments” are divided up as follows:

Cash flow hedges and fair value hedges are concluded in particular to hedge price change and interest rate change risks of hedged items. Derivatives not used for hedging are largely closed positions, with the criteria for hedge accounting according to IFRS 9 not being fulfilled.

7.2 Measurement at fair value

7.2.1 Fair value of financial assets and liabilities that are measured regularly at fair value

Pursuant to IFRS 13, financial instruments that are measured at fair value are classified within a fair value hierarchy. In view of possible uncertainties relating to possible estimates of the fair values, a distinction is made between three levels:

Level 1: Measurement on the basis of a published price quotation for identical assets or liabilities in an active market.

Level 2: Measurement on the basis of inputs that are observable either directly or indirectly in the market and measurements based on prices quoted in inactive markets.

Level 3: Measurement on the basis of inputs not observable in the market.

If the inputs used to determine the fair value of an asset or liability are attributable to different levels of the fair value hierarchy, the measurement at fair value is wholly assigned to the fair value hierarchy level that corresponds to the lowest input which, in the aggregate, is material for the measurement.

The financial instruments measured at fair value are assigned to levels 1 to 3 as follows:

Level 3 financial instruments have developed as follows:

The gains (losses) recognised directly in equity include the upward revaluation of the investment in Verbund Hydro Power GmbH in the amount of EUR 36,056.4 thousand (previous year: EUR 8,765.6 thousand). The fair value of the investment (0.42%) of EUR 66,519.1 thousand (30 September 2022: EUR 30,462.7 thousand) was determined based on the expected future distributions and a discount rate of 8.41% (30 September 2022: 8.3%). The increase in fair value is mainly attributable to higher expected distributions.

The resulting income of EUR 34,731.4 thousand (previous year: EUR 10,495.1 thousand) through equity was recognised as other comprehensive income in the item “Change in value of investments and securities FVOCI”.

An increase (reduction) of the cash flow assumptions by 25% would have resulted in an increase (reduction) of the OCI in the amount of EUR 13,338.9 thousand (EUR -13,338.9 thousand) (previous year: EUR 6,878.5 thousand (EUR -6,878.5 thousand)). An increase (reduction) of the discount rate by 50 basis points would have resulted in a reduction (increase) of the OCI in the amount of EUR -1,491.2 thousand (EUR 1,564.3 thousand) (previous year: EUR -1,413.0 thousand (EUR 1,586.1 thousand)).

7.2.2 Valuation techniques and inputs used in measuring fair values

In general, the fair values of the financial assets and liabilities correspond to their market prices on the reporting date. If active market prices are not directly available, then – if they are not of minor significance – the fair values are calculated using recognised actuarial measurement models and current market parameters (in particular interest rates, exchange rates and the credit rating of contractual partners). This is done by discounting the cash flows from the financial instruments to the reporting date.

The following valuation methods and inputs were used:

7.2.3 Fair values of financial assets and liabilities that are not measured regularly at fair value, however for which the fair value must be disclosed

The items trade receivables, receivables from affiliated companies, receivables from joint arrangements and associated companies, other financial assets, as well as fixed term deposits and current investments are characterised by predominantly short remaining terms. This means that their carrying amounts as of the reporting date roughly represent their fair value. If they are material and have a fixed interest rate, then the fair value of non-current lendings corresponds to the present value of the payments associated with the assets, taking into consideration the current market parameters in each case (interest rates, credit spreads).

Trade payables, liabilities to affiliated companies, liabilities to joint arrangements and associated companies and other financial liabilities usually have short remaining terms. The values on the balance sheet are approximately the fair values. If they are material and bear interest at a fixed rate, the fair value of financial liabilities is determined using the present value of the payments associated with the liabilities, taking into consideration the respectively applicable market parameters (interest rates, credit spreads).

The following financial assets and liabilities have a fair value different from the carrying amount:

The fair values of the Level 3 financial liabilities disclosed above were determined in agreement with generally accepted valuation techniques based on discounted cash flow analyses. Material input is the discount rate, which takes into account the expected credit loss of the counterparty.