Siemens 2014 Annual Report Download - page 293

247 D. Consolidated Financial Statements 337 E. Additional Information
248 D. Consolidated Statements of Income
249 D. Consolidated Statements of Comprehensive Income
250 D. Consolidated Statements of Financial Position
251 D. Consolidated Statements of Cash Flows
252 D. Consolidated Statements of Changes in Equity
254 D. Notes to Consolidated Financial Statements
330 D. Supervisory Board and Managing Board

Item Other includes indemnifications issued in connection
with dispositions of business entities. Such indemnifications, if
customary to the relevant transactions, may protect the buyer
from potential tax, legal and other risks in conjunction with the
purchased business entity. Indemnifications include those for
Unify (EN), disposed of in fiscal  and Siemens IT Solutions
and Services disposed of in fiscal . As of September ,
 and , the total amount accrued for guarantees in item
Other is €  million and €  million, respectively.
As of September ,  and , future payment obligations
under non-cancellable operating leases are as follows:
September ,
(in millions of €)  
Within one year 815 807
After one year but not more than five years 1,574 1,556
More than five years 828 757
3,217 3,120
Total operating rental expense for the years ended Septem-
ber ,  and  were € , million and € , million,
respectively. Total sublease income amounts to €  million and
€  million, respectively in fiscal  and . Total future
minimum sublease payments expected to be received under
non-cancellable subleases as of September ,  and 
amount to €  million and €  million, respectively.
As of September ,  and , the Company has commit-
ments to make capital contributions to the equity of various
companies of €  million and €  million, respectively.
The Company is jointly and severally liable and has capital con-
tribution obligations as a partner in commercial partnerships
and as a participant in various consortiums.
NOTE  Legal proceedings
PROCEEDINGS OUT OF OR IN CONNECTION
WITH ALLEGED BREACHES OF CONTRACT
As previously reported, Siemens AG is a member of a supplier
consortium that has been contracted to construct the nuclear
power plant “Olkiluoto ” in Finland for Teollisuuden Voima Oyj
(TVO) on a turnkey basis. The agreed completion date for the
nuclear power plant was April , . Siemens AG’s share of
the contract value is approximately  %. The other member of
the supplier consortium is a further consortium consisting of
Areva NP S.A.S. and its wholly-owned subsidiary, Areva GmbH.
Completion of the power plant has been delayed for reasons
which are in dispute. In December , the supplier consor-
tium filed a request for arbitration against TVO demanding an
extension of the construction time, additional compensation,
milestone payments, damages and interest. In , the sup-
plier consortium increased its monetary claims to € . billion.
TVO rejected the claims and made counterclaims against the
supplier consortium consisting primarily of damages due to
the delay. As of September , TVO’s counterclaims amounted
to € . billion based on a delay of up to  months. In Octo-
ber , TVO estimated that its counterclaims, based on a de-
lay of  months, may be increased to € . billion in calendar
year . The supplier consortium increased its monetary
claims in October  to € . billion. The arbitration proceed -
ings may continue for several years. The amounts claimed by
the parties may be updated further.
As previously reported, Essent Wind Nordsee Ost Planungs-
und Betriebsgesellschaft mbH filed a request for arbitration
against Siemens AG in October  alleging breaches of a con-
tract for the delivery of a High Voltage Substation entered into
by the parties in . The claimant claims damages in an
amount of €  million plus interest and a determination that
Siemens AG shall be liable for any further damages claimed to
amount to €  million. Siemens AG filed a motion to dismiss
the request for arbitration. In addition, Siemens filed counter-
claims of €  million plus interest and requested a determina-
tion concerning compensation for all future damages.
During fiscal year  Siemens Industrial Turbomachinery Ltd.,
UK was sued before an Iranian Court. The alleged damage claims
are not quantified. Siemens will defend itself against the action.
PROCEEDINGS OUT OF OR IN CONNECTION
WITH ALLEGED COMPLIANCE VIOLATIONS
As previously reported, Siemens AG agreed on a settlement
with nine out of eleven former members of the Managing and
Supervisory Board in January . The settlement relates to
claims of breaches of organizational and supervisory duties
in view of the accusations of illegal business practices that oc-
curred in the course of international business transactions
in calendar  to  and the resulting financial burdens
for the Company. In January , Siemens AG agreed on a
settlement with Dr. Thomas Ganswindt. In August ,
Siemens AG reached a settlement with Mr. Joachim Neubürger.
The settlement is subject to the approval of the annual share-
holders’ meeting of Siemens AG and will terminate the litiga-
tion proceeding.
As previously reported in July , Hellenic Telecommunica-
tions Organization S.A. (OTE) filed a lawsuit against Siemens AG
with the district court of Munich, Germany, seeking to compel