Siemens 2007 Annual Report Download - page 298

298 Notes to Consolidated Financial Statements
(in millions of €, except where otherwise stated and per share amounts)
Liquidity risk
Liquidity risk results from the Company’s potential inability to meet its fi nancial
liabilities, e.g. settlement of its fi nancial debt, paying its suppliers and settling
fi nance lease obligations. Beyond effective net working capital and cash manage-
ment, Siemens mitigates liquidity risk by arranged borrowing facilities with
highly rated fi nancial institutions, via a medium-term note program and via its
global multi-currency commercial paper program. For further information on
sources of liquidity see Note 22.
In addition to the above mentioned sources of liquidity, Siemens constantly
monitors funding options available in the capital markets, as well as trends in the
availability and costs of such funding, with a view to maintaining fi nancial fl exi-
bility and limiting repayment risks.
The following table refl ects all contractually fi xed pay-offs for settlement,
repayments and interest resulting from recognized fi nancial liabilities, including
derivative fi nancial instruments with a negative market value as of September 30,
2007. For derivative fi nancial instruments the market value is presented, whereas
for the other obligations the respective undiscounted cash fl ows for the respective
upcoming fi scal years are presented. Cash outfl ows for fi nancial liabilities without
fi xed amount or timing, including interest, are based on the conditions existing at
September 30, 2007.
The risk implied from the values shown in the table above, refl ects the one-
sided scenario of cash outfl ows only. Leasing obligations, trade payables and other
fi nancial liabilities mainly originate from the fi nancing of assets used in our
ongoing operations such as property, plant, equipment and investments in work-
ing capital – e.g. inventories and trade receivables. These assets are considered in
the Company’s overall liquidity risk. To monitor existing fi nancial assets and lia-
bilities as well as to enable an effective controlling of future risks, Siemens has
established a comprehensive risk reporting covering its worldwide business units.
(€ in millions) 2008 2009
2010
to 2012
2013 and
thereafter
Non-derivative fi nancial liabilities
Notes and bonds 1,161 992 4,068 6,707
Loans from banks 591 86 176 829
Other fi nancial indebtedness 4,445 76 161 126
Obligations under fi nance leases 64 63 109 119
Trade payables 8,418 27 14 6
Other fi nancial liabilities 1,405 86 22 93
Derivative fi nancial liabilities 294 38 78 243