27. Net financing result
|
(in millions of euros) |
2023 |
2022 |
|
Interest income from financial assets |
14 |
10 |
|
Exchange differences |
3 |
4 |
|
Other financial income |
84 |
187 |
|
Finance income |
101 |
201 |
|
Interest expense on financial liabilities measured at amortised cost |
-32 |
-10 |
|
Interest expense on lease liabilities |
-6 |
-4 |
|
Exchange differences |
-6 |
-11 |
|
Interest expense from discounting of provisions/other employee benefits |
-3 |
-1 |
|
Other financial expenses |
-11 |
-2 |
|
Finance expense |
-58 |
-28 |
|
Net finance result included in the income statement |
43 |
173 |
Other financial income includes €66 million in 2023 due to the release of provisioned liabilities and guarantees in relation to insolvency proceedings in Germany (see note 30).
An accounting upward revaluation of €103 million has been recognised under other financial income 2022 as a result of acquisition accounting, whereby assets and liabilities have been reassessed. Shareholder obligations as well as part of the creditor obligations are released, as agreed in the insolvency plan, and are set off against the purchase price. In addition, the guarantees of €77 million provided for in 2021 in connection with the uncertainties in the acquisition of the Mitteldeutschland franchises were released in 2022 and recognised as financial income.
Accounting policy
Finance income includes the interest income from monies invested, lease income, gains from the sale of available-for-sale financial assets and gains on hedging instruments that are recognised in the income statement. Interest income is recognised in the income statement as it accrues, using the effective interest method. Dividend income is recognised in the income statement when the right to the dividend payment is established.
Finance expenses include the interest expenses on borrowings, lease contracts, interest accrual on provisions and losses on hedging instruments that are recognised in the income statement. All borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognised in the income statement using the effective interest method. No borrowing costs were capitalised in 2023 or 2022.
Exchange rate gains and losses are included in the finance income and expense respectively.