BMW 2008 Annual Report Download - page 124

125 Group Financial Statements
in euro million 31.12. 2008 31.12. 2007
Euro 52 76
US Dollar 119 109
British Pound 7 10
40
In the following table the potential volume of fair value
fluctuations – measured on the basis of the value-at-risk
approach – are compared with the expected value for the
Other risks
The BMW Group is exposed to raw material price risks. A
description of how these risks are managed is provided
in the Group Management Report on
pages  –  . De-
rivative financial instruments are used on a relatively small
scale to reduce these risks, primarily for the purchase of
precious metals. The risk from these derivatives was not
material to the Group in  and  and remains small
at the present time. For this reason, a sensitivity analysis
for these derivatives is not provided.
interest rate relevant positions of the BMW Group for the
three principal currencies:
A further exposure relates to the residual value risk on
vehicles returned to the Group at the end of finance lease
contracts. The risks from financial instruments used
in this context were not material to the Group in the past
and at the end of the reporting period. A description of
how these risks are managed is provided in the Group
Management Report on pages  – . Information re-
garding the
residual value risk from operating leases is
provided in the section on accounting policies.
Explanatory notes to the cash flow statements
The cash flow statements show how the cash and cash
equivalents of the BMW Group and of the Automobiles
and Financial Services segments have changed in the
course of the year as a result of cash inflows and cash out-
flows. In accordance with IAS  (Cash Flow Statements),
cash flows are classified into cash flows from operating,
investing and financing activities. The Group and segment
cash flow statements are presented on pages  – .
Cash and cash equivalents included in the cash flow state-
ment comprise cash in hand, cheques, and cash at bank,
to the extent that they are available within three months
from the end of the reporting period and are subject to an
insignificant risk of changes in value. The negative impact
of changes in cash and cash equivalents due to the effect
of exchange rate fluctuations in  was euro  million
(: euro  million).
The cash flows from investing and financing activities are
based on actual payments and receipts. The cash flow
from operating activities is computed using the indirect
method, starting from the net profit of the Group. Under
this method, changes in assets and liabilities relating to
operating activities are adjusted for currency translation
effects and changes in the composition of the Group. The
changes in balance sheet positions shown in the cash
flow statement do not therefore agree directly with the
amounts shown in the Group and segment balance sheets.
If the BMW Group acts as the lessor in a finance lease, the
relevant cash flows are reported in the cash flow statement
as part of the cash flow from investing activities. If the
BMW Group acts as the lessee in a finance lease, the
cash flows are reported as part of the cash flows from
operating and investing activities.
If the BMW Group acts as the lessor in an operating
lease, cash flows are reported as part of the cash flow
from investing activities. In the final case, where the
BMW Group acts as the lessee in an operating lease,
cash flows are reported as part of the cash flow from
operating activities.
In , some of the shares of Cirquent GmbH, Munich,
were sold to NTT Data Corporation, Tokyo. The cash
inflow for the purchase consideration, amounting to euro
 million, was not reported on a separate line within
in-
vesting activities on the grounds of materiality. The sale of
Cirquent GmbH, Munich, resulted in an outflow of cash
funds amounting to euro  million. The amounts of assets
and liabilities of Cirquent GmbH, Munich, summarised by
major category pursuant to IAS . (d), are not disclosed
on the grounds of materiality.
Cash outflows for taxes on income and cash inflows for
interest are classified as cash flows from operating activi-
ties in accordance with IAS . and IAS .. Cash out-
flows for interest are presented on a separate line within
cash flows from financing activities.
Cash flows from dividends received amounted to euro  mil-
lion
(: euro  million).