Siemens 2014 Annual Report Download - page 209

247 D. Consolidated Financial Statements
337 E. Additional Information
213 C. Overall assessment of the economic position
214 C. Subsequent events
215 C. Sustainability and citizenship
225 C. Report on expected developments and
associated material opportunities and risks
242 C. Compensation Report and legal disclosures
242 C. Siemens AG (Discussion on basis
of German Commercial Code)

NET DEBT
Net debt results from total debt less total liquidity. Total liquid-
ity refers to the liquid financial assets we have available at the
end of a reporting period to fund our business operations and
pay for near-term obligations. Total liquidity comprises Cash
and cash equivalents as well as current Available-for-sale finan-
cial assets, as stated in the Consolidated Statements of Finan-
cial Position. Management uses the Net debt measure for inter-
nal finance management, as well as for external communication
with investors, analysts and rating agencies.
(in millions of €)
September ,
 
Short-term debt and current maturities
of long-term debt 1,620 1,944
Long-term debt 19,326 18,509
Total debt 20,947 20,453
Cash and cash equivalents (8,013) (9,190)
Available-for-sale financial assets (current) (925) (601)
Total liquidity (8,938) (9,790)
Net debt  12,008 10,663
1 We typically need a considerable portion of our cash and cash equivalents and
our current available-for-sale financial assets for purposes other than debt reduc-
tion. The deduction of these items from total debt in the calculation of Net debt
therefore should not be understood to mean that these items are available exclu-
sively for debt reduction at any given time.
The changes in Net debt from fiscal  to  may also be
presented as follows:
Changes in Net debt (in millions of €)
1 In fiscal , cash inflows for the decrease in operating
net working capital included cash inflows for inventories
less advance payments received of € million, for
trade and other receivables of € million, for trade
payables of € million and cash outflows for billings
in excess of costs and in estimated earnings on uncom-
pleted contracts and related advances of € million.
2 Continuing operations.
3 Included cash flows relating to certain financing activities
such as dividends paid and purchase of treasury shares
as well as effects without cash flow impact such as from
currency translations.
OFF-BALANCE-SHEET COMMITMENTS
As of September ,  and  we recorded € . billion
and € . billion, respectively, of the undiscounted amount of
maximum potential future payments related to guarantees. The
increase in these commitments included guarantees related to
the disposition of businesses and agreements related to our
project businesses. As of September ,  and  we
recorded also € . billion and € . billion, respectively, of
future payment obligations under non-cancellable operating
leases and €  million and €  million, respectively, for com-
mitments to make capital contributions to the equity of various
companies.
Further information about these off-balance-sheet commit-
ments is provided in NOTE  in D. NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS.
As of September ,  and  we recorded also irrevoca-
ble loan commitments of € . billion and € . billion.
A considerable portion of these commitments resulted from
10,663 (83) (7,147) 4,364 4,211 12,008
Net debt as of
September , 
Cash inflows for the
decrease in operating
net working capital 
Income and other changes
in cash flows from
operating activities
Cash flows from
investing activities 
Changes in certain
financing activities 
Net debt as of
September , 
Total cash flows from operating activities 
asset-based lending transactions, meaning that the respective
loans can be drawn only after the borrower has provided suffi-
cient collateral. The increase in these commitments year-over-
year was due mainly to new business volume at SFS, including
positive currency translation effects.
OTHER CAPITAL RESOURCES AND REQUIREMENTS
For information related to the expected payments for dividend
and share buybacks, see C.. DIVIDEND AND SHARE BUYBACKS.
For information related to expected cash inflows and outflows
in connection with portfolio transactions, see NOTE  in
D. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
With our ability to generate positive operating cash flows,
our total liquidity of € . billion and our € . billion in unused
lines of credit and given our credit ratings at year-end, we
believe that we have sufficient flexibility to fund our capital
requirements. Also in our opinion, our working capital is
sufficient for our present requirements.