C22. Other provisions
Changes in other provisions were as follows.
|
SEK in millions |
December 31, 2016 |
||||
|
Put options and |
Restructuring |
Asset |
Other |
Total |
|
|
Opening balance |
850 |
672 |
2,896 |
805 |
5,222 |
|
of which financial liabilities at amortized cost |
– |
– |
– |
287 |
287 |
|
Provisions for the period |
– |
608 |
243 |
15,280 |
16,131 |
|
Operations divested |
-881 |
– |
-74 |
-339 |
-1,294 |
|
Utilized provisions |
– |
-889 |
-95 |
-78 |
-1,062 |
|
Reversals of provisions |
– |
-7 |
-1 |
-251 |
-259 |
|
Reclassifications |
– |
-7 |
-8 |
– |
-15 |
|
Timing and interest-rate effects |
– |
– |
7 |
1 |
8 |
|
Exchange rate differences |
31 |
10 |
55 |
20 |
116 |
|
Reclassification to liabilities directly associated |
– |
– |
– |
-1 |
-1 |
|
Closing balance |
0 |
387 |
3,023 |
15,436 |
18,846 |
|
of which non-current portion |
– |
83 |
3,015 |
2,076 |
5,173 |
|
of which current portion |
– |
304 |
8 |
13,361 |
13,673 |
|
of which financial liabilities at amortized cost |
– |
– |
– |
– |
– |
Other provisions include the provision for the settlement amount proposed by the US and Dutch authorities, see Note C34 for more information. For financial liabilities, the carrying value equals fair value as provisions are discounted to present value. Refer to Note C25 “Financial assets and liabilities by category and level” for more information on financial instruments classified by category.
Put options and contingent consideration
The closing balance as of December 31, 2015 in total SEK 850 million, was related to Yoigo in Spain, which was divested in the fourth quarter of 2016. See Note C34 for information on sale of Yoigo in Spain and on put options in discontinued operations.
Restructuring provisions
The restructuring provisions represent the present value of management’s best estimate of the amounts required to settle the liabilities. The estimates may vary as a result of changes in the actual number of months an employee is staying in redeployment before leaving and in the actual outcome of negotiations with lessors, sub-contractors and other external counterparts as well as the timing of such changes. The restructuring provisions are mainly related to workforce reduction as a result of ongoing optimization of the business in the Nordics and Group functions.
Asset retirement obligations and other provisions
Asset retirement obligations mainly refer to handling hazardous waste such as worn-out telephone poles impregnated with creosote or arsenic and to dismantling and restoration of mobile and fixed network sites. Remaining provisions as of December 31, 2016, are expected to be fully utilized in the period 2017–2045, depending on factors such as any contractual renewal options for site leases and dismantling plans decided by management.
Other provisions include provisions for damages and court cases, including the provision for the settlement amount proposed by the US and Dutch authorities. Other provisions also include provisions for future onerous and other loss-making contracts, insurance provisions, payroll taxes on future pension payments, estimated expenses related to fulfilling representations made and warranties, i e transaction warranties, and for potential litigation etc. in connection with disposals and winding-up of group entities, associated companies and other equity holdings as well as provision for buy back commitments for sold equipment in certain markets. Full utilization of these provisions is expected in the period 2017–2028.
The provisions represent the present value of management’s best estimate of the amounts required to settle the liabilities.