PRINCIPLES AND GOALS OF FINANCIAL MANAGEMENT
Financial management at the Volkswagen Group comprises the areas of liquidity management, currency, interest rate and commodity risk management, as well as credit and country default risk management. This is performed centrally for all Group companies by Group Treasury, based on internal directives and risk parameters.
For more information on the principles and goals of financial management, please refer to the Notes to the 2008 Consolidated Financial Statements to chapter "Financial risk management" as well as to the Risk Report to chapter "Risks arising from financial instruments".
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CASH FLOW STATEMENT BY DIVISION |
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Volkswagen Group |
Automotive1 |
Financial Services | |||||||||||||||||||
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€ million |
2008 |
2007 |
2008 |
2007 |
2008 |
2007 | ||||||||||||||||
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Profit before tax |
6,608 |
6,543 |
5,677 |
5,474 |
931 |
1,069 | ||||||||||||||||
|
Income taxes paid |
–2,075 |
–1,172 |
–1,973 |
–1,290 |
–102 |
118 | ||||||||||||||||
|
Depreciation and amortization expense |
8,438 |
9,238 |
6,680 |
7,429 |
1,758 |
1,809 | ||||||||||||||||
|
Change in pension provisions |
140 |
103 |
132 |
99 |
8 |
4 | ||||||||||||||||
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Other noncash income/expense and reclassifications2 |
893 |
–50 |
591 |
190 |
302 |
–240 | ||||||||||||||||
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Gross cash flow |
14,004 |
14,662 |
11,107 |
11,902 |
2,897 |
2,760 | ||||||||||||||||
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Change in working capital |
–3,205 |
1,000 |
–2,336 |
1,773 |
–869 |
–773 | ||||||||||||||||
|
Change in inventories |
–3,056 |
–1,856 |
–2,688 |
–1,219 |
–368 |
–637 | ||||||||||||||||
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Change in receivables |
–1,333 |
–942 |
–1,130 |
–555 |
–203 |
–387 | ||||||||||||||||
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Change in liabilities |
815 |
2,244 |
1,100 |
2,092 |
–285 |
152 | ||||||||||||||||
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Change in other provisions |
369 |
1,554 |
382 |
1,455 |
–13 |
99 | ||||||||||||||||
|
Cash flows from operating activities |
10,799 |
15,662 |
8,7713 |
13,6753 |
2,028 |
1,987 | ||||||||||||||||
|
Cash flows from investing activities |
–19,710 |
–13,474 |
–11,450 |
–6,550 |
–8,260 |
–6,924 | ||||||||||||||||
|
of which: acquisition of |
–6,883 |
–4,638 |
–6,762 |
–4,555 |
–121 |
–83 | ||||||||||||||||
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capitalized development costs |
–2,216 |
–1,446 |
–2,216 |
–1,446 |
– |
– | ||||||||||||||||
|
change in leasing and rental assets (excluding depreciation) |
–3,055 |
–2,763 |
–277 |
–80 |
–2,778 |
–2,683 | ||||||||||||||||
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change in financial services receivables |
–5,053 |
–3,588 |
297 |
251 |
–5,350 |
–3,839 | ||||||||||||||||
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acquisition and disposal of equity investments |
–2,596 |
–1,224 |
–2,571 |
–869 |
–25 |
–355 | ||||||||||||||||
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Net cash flow |
–8,911 |
2,188 |
–2,679 |
7,125 |
–6,232 |
–4,937 | ||||||||||||||||
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Change in investments in securities and loans4 |
430 |
–2,338 |
496 |
–2,020 |
–66 |
–318 | ||||||||||||||||
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Cash flows from financing activities |
8,123 |
787 |
942 |
–4,204 |
7,181 |
4,991 | ||||||||||||||||
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Changes in cash and cash equivalents due to exchange rate changes |
–113 |
–90 |
–57 |
–81 |
–56 |
–9 | ||||||||||||||||
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Net change in cash and cash equivalents |
–471 |
547 |
–1,298 |
820 |
827 |
–273 | ||||||||||||||||
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Cash and cash equivalents at Dec. 315 |
9,443 |
9,914 |
7,639 |
8,937 |
1,804 |
977 | ||||||||||||||||
|
Securities and loans |
7,875 |
9,178 |
5,679 |
7,047 |
2,196 |
2,131 | ||||||||||||||||
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Gross liquidity |
17,318 |
19,092 |
13,318 |
15,984 |
4,000 |
3,108 | ||||||||||||||||
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Total third-party borrowings |
–69,555 |
–57,992 |
–5,279 |
–2,506 |
–64,276 |
–55,486 | ||||||||||||||||
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Net liquidity |
–52,237 |
–38,900 |
8,039 |
13,478 |
–60,276 |
–52,378 | ||||||||||||||||
fair value
