Financial report
2017

01

CONTENTS﻿At a glanceContents

On the road, at work and at home, millions of people around the world
rely on DEKRA’s safety expertise. This leading unlisted expert organization is fulfilling its corporate mission of improving safety with impartiality
and independence. With a workforce of more than 44,000, DEKRA issynonymous with innovative services in the safety segment in more than
50 countries across five continents. This vision to be realized by our centenary in 2025 is as follows: DEKRA is becoming the global partner for asafe world.

02

GROUP MANAGEMENT REPORT

03Group business model04		

Vision 2025

04 		

Systems of management05		

Research and development

2016

2017

2,720.3

2,903.6

3,134.823	
C onsolidated statement ofcomprehensive income24	Consolidated statement offinancial position26	
C onsolidated statement ofchanges in equit y

Repor t on economic position

07		
General economic andindustr y-specific conditions28	
C onsolidated statement ofcash flows08		

11		 Environmental protection and sustainability30	N otes to the consolidated
financial statements

11		 Personnel repor t

93

13		

97	
R epor t by the Chairman of
the Super visor y Board

17

2015

CONSOLIDATED FINANCIAL STATEMENTS

Corporate information

03		

07

The portfolio of the Business Units DEKRA Automotive, DEKRA Industrial
and DEKRA Personnel comprises twelve strategic business sectors:­Vehicle Inspection, Expertise, Automotive Solutions, Homologation &Type Approvals, Claims Services, Industrial & Construction Inspection,
Material Testing & Inspection, Product Testing & Certification, Business
Assurance, Insight, Training & Education and Temporary Work.

KE Y DATA DEKR A SE

Foreword

Business performance

Financial position and performance

Risk, oppor tunities and forecast repor t

17		

Risk repor t

20		

Oppor tunities repor t

21 		

Forecast repor t

Revenue and income

Total revenue
Share of international revenue

in million EUR
in %

39.3

40.1

39.3

in million EUR

201.1

220.6

236.1

in %

7.4

7.6

7.5

in million EUR

178.1

200.9

228.9

Total assets

in million EUR

1,977.4

2,091.3

2,090.2

Equityin million EUR

503.4

543.5

635.5

in %

25.5

26.0

30.4

36,67339,35744,057

Adjusted EBIT
Adjusted EBIT margin
Adjusted EBTStatement of financial position

Equity ratio
Employees

Number as of Dec. 31

DEKRA

Financial Report 2017

Independent auditor’s repor t

02

FOREWORDGROUP MANAGEMENT REPORT﻿Corporate Information

Foreword by the
Chairman of the Management Board

Dear business partners,
Dear readers,

S T E FA N K Ö L B L

Chairman of the Management Board
DEKRA e.V. and DEKRA SE

With a comprehensive range of testing, inspection andcertification services, DEKRA ensures safety on the road,at work and at home in more than 50 countries. And it
does so with great success: In the 2017 financial year,
DEKRA revenue increased by 8.0 percent to 3.1 billion
euros. Adjusted operating earnings rose to 236 million
euros. As a result of acquisitions and, above all, organic
growth, the number of employees has increased by over
4,000 to more than 44,000. The 14th successive year of
growth was characterized by positive developments
across all three business units.

With revenue of 1.56 billion euros, the DEKRA Automotive Business Unit generated anincrease of 3.8 percent. The DEKRA Industrial Business Unit also continued its successful
trajectory. Revenue climbed by 5.3 percent to 896 million euros. On the back of innovative training, qualification and personnel services, the DEKRA Personnel Business Unit
grew by 24.8 percent to 650 million euros.
DEKRA will continue on its stable growth path – based on our active role in shaping themegatrend of “safety” and an international positioning that gives us a disproportionately
high share of its growth. For more than 90 years, we have fulfilled our statutory mission toensure the safety of people. With this in mind, we have set ourselves the goal of becoming
the global partner for a safe world by the time of our 100th anniversary in 2025. Join us
on this journey.

Group management reportfor the fiscal year 2017

CORPOR ATE INFOR M ATIONGroup business model
DEKR A ensures safet y

For over 90 years now, DEKRA has strived to ensure people’ssafety. What started out in 1925 with the technical monitoringof motor vehicles, today comprises a wide range of services fortesting, inspecting and certifying products, processes and plants.
DEKRA is the world’s fourth largest expert organization in the
TIC industry (testing, inspection, certification) and is the largest
unlisted entity. It benefits from the lasting and global trend formore safety. The Company’s mission pursuant to its articles ofincorporation is just as valid today as when it first started out.

Stuttgart-based DEKRA SE coordinates the business operationsof the Business Units DEKRA Automotive, DEKRA Industrial
and DEKRA Personnel. In seven Service Units and five Service
Lines, some 44,000 people work in more than 50 countries onfive continents. DEKRA is the global market leader in vehicle
inspection, and is one of the leading companies in other businesssegments.

SERVICES PORTFOLIOAUTOMOTIVE SERVICES

INDUSTRIAL SERVICESPERSONNEL SERVICES

Vehicle Inspection

Industrial & Construction Inspection

Training & Education

Expertise

Material Testing & Inspection

Temporary Work

Automotive Solutions

Product Testing & Certification

Homologation & Type Approvals

Business Assurance

Claims Services

Insight

Sincerely,

S T E FA N KÖ L B L
Chairman of the Management Board
DEKR A e.V. and DEKR A SE

DEKRA

Financial Report 2017

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DEKRA

Financial Report 2017

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GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Corporate Information

Corporate Information

DEKR A Automotive

Vision 2025

Internal monitoring system

Road safety and the associated services are at the heart of theBusiness Unit DEKRA Automotive. The service portfolio
includes periodical vehicle inspection for private individuals andcommercial fleets as well as homologation and type approvals.
DEKRA prepares expertises for insurance companies and private vehicle owners, and also handles claims services. Automobile dealerships, vehicle manufacturers, car rental companies
and operators of business vehicle fleets benefit significantly from
DEKRA’s know-how in the Automotive Solutions Service Unit
(used car management and consulting). Besides the key European markets Germany, France, Sweden, the Czech Republic,
Portugal and Italy, markets in other European countries as wellas in the regions of North America and Asia Pacific are gaining
importance in the Business Unit DEKRA Automotive.

We will become the global par tner for a safe world

Internal monitoring makes an important contribution to generating confidence among shareholders, customers, suppliers,
employees and all other stakeholders in the management andcontrol of the Company. It forms part of DEKRA’s corporate
governance and supports the Supervisory Board in overseeing
the Company’s management as well as the Management Boardin the future-proof management of the Company. The internalmonitoring system (IMS) defines the standards for a uniform
reporting procedure. The IMS ensures that the companies comply with statutory requirements and internal policies, and act inaccordance with applicable standards on the market. Internal
audit and other monitoring functions implemented at the
DEKRA Group support management by ensuring the objective
and unbiased monitoring of the design and functionality of theprocesses. Audits also serve to safeguard the Company’s operating assets. The internal audit system at group level comprises
financial audits to audit and assess financial accounting for its
informative value, reliability and compliance as well as operational audits, which are used to audit and assess the efficiency
and effectiveness of business processes. These are complemented
by compliance audits geared to ensure adherence to statutory
requirements and internal policies, project audits for performing
process analyses and project evaluations, as well as special investigations in cases of potential misconduct. The Management
Board is regularly informed about the findings of the IMS
reviews.

DEKR A Industrial

Since 2005, the Business Unit DEKRA Industrial has become acornerstone of DEKRA in just 13 years. The Company has
responded to growing demand from businesses for specialized
service packages and consulting skills focusing on the safety ofprocesses, plant and entire organizations. The portfolio covers
the areas of environmental and industrial safety, machinery,plant and building inspection, material and product testing,certification as well as consulting services focusing on process
and organizational safety. Customers include SMEs and large
corporations.
DEKR A Personnel

Training and education are the foundation for ensuring prosperity in Germany and Europe. Both the public and private sectors therefore invest in basic training and further development.
The Business Unit DEKRA Personnel, which includes DEKRA
Akademie Group and DEKRA Arbeit Group, is one of the largest private educational institutions in Germany and one of theleading personnel service providers with a strong market position in the Top 10 for temporary work throughout Germany.

DEKRA

The strategy and operational management of DEKRA are
guided by the principle of stable and healthy growth. Professional expertise, innovative power and customer proximity are
therefore ongoing tasks. Through its strategic “Vision 2025”
program, launched in its 90th anniversary year in 2015, with
its focus on the three areas of life – on the road, at work and athome –, DEKRA has mapped its course for the coming years.
In this context, DEKRA has set itself the goal of becoming the
global partner for a safe world in its centenary year 2025. In thereporting year 2017, DEKRA demonstrated its full commitment to the implementation of this long-term strategic focus.
An important step in this direction is the further expansion of the Company’s international presence. DEKRA is concentrating on organic growth as well as strategic acquisitions tostrengthen existing business sectors at regional level and developing new markets.
As part of the Group’s strategy 2020, six specific initiatives
were launched to achieve the vision: “Thought Leadership”,“Strategic Marketing & Sales”, “Innovation Strategy & Processes”,“GLOBEX”, “Change Management Vision 2025” and “Corporate
Culture & Communication”.
Systems of management
Compliance management system

Society’s expectations of responsible corporate governance arehigh. For some time, DEKRA has been equipped with a systematic Compliance Management System (CMS), which is tightly
meshed with its risk management system. The CMS is constantly
being further developed and adapted to the changing DEKRA
organization as well as the changing legal requirements. The
worldwide “Compliance Executives Dialog” rolled out in 2016
was continued in the fiscal year 2017. This involves executives
informing their employees about compliance-relevant issues andtheir implementation in accordance with the rules and regulations. Communication relating to the Compliance Guidelines isfound on all important digital platforms such as Intranet,
DEKRA Connect and the Internet. In addition DEKRA has
regional compliance managers as well as a group-wide modular
training concept.

Financial Report 201705

ment system. Last year too, due to the modification and updatingof internationally valid standards, such as the updating of theaccreditations DIN/ISO/EN/IEC 17020, 17021, 17024 and 17025,
the modified requirements were implemented in the processes
and included in a risk assessment process.
Quality management (QM) not only sets the requirements,
but also constantly inspects and optimizes the processes andservices at DEKRA. In addition to annual external inspections
conducted by the authorities, all subsidiaries with certified or
accredited QM systems ensure the quality of their products andprocesses by means of regular and planned audits. QM also
manages and secures DEKRA’s accreditations and official permits. The number of accreditations increased from 285 to 329
due to modified regulatory requirements and also new services
added to the portfolio recently, in some cases in connection with
newly acquired companies within the DEKRA Group.
DEKRA Industrial has successfully completed all major
reaccreditations worldwide and has obtained numerous extensions in accreditation scopes. Furthermore, new accreditations
were concluded in the Product Testing & Certification Service
Unit. These include short circuit and high voltage tests in thearea of energy transmission and distribution as well as in particular cyber security in the Internet of Things. In addition,required transitions to new standards and to modified regulatory frameworks were undertaken during the fiscal year. An
important milestone in the reporting year was the conclusion of
the reaccreditation procedure for the DEKRA inspection bodyaccording to ISO 17020 in vehicle testing.

Qualit y management

Integrity, reliability and impartiality are crucial to DEKRA’s success as an independent expert organization. DEKRA’s reputation
and ability to compete on the market, and our impartiality whenrendering our services and public duties, are heavily dependent
on the conduct of each and every individual. Authorities, clients,
customers and business partners can reasonably expect that all
DEKRA employees, that is employees, middle management,
executives and board members, work on the basis of these standards, and can be relied upon to fulfil their duties and conduct
themselves as fair-minded business partners. The internalrequirements and obligations are defined in the quality manage-

DEKRA

Research and development

DEKRA has been an independent expert organization in thearea of road safety for more than 90 years - with vehicle inspections, with the deployment of accident analysts and accident
researchers, with crash tests, public campaigns and cooperation in national and international organizations. Crash tests
and accident analyses support automobile manufacturers andsystem suppliers in particular. Furthermore, DEKRA uses its
status as an international expert organization to inform thepublic in workshops and publications about relevant technicalrequirements for more road safety.

Financial Report 2017

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GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Corporate Information

Report on Economic Position

In September 2017, DEKRA joined forces with AUTO BILD tolaunch the campaign “Handy weg! Dein Leben zählt” (“Put away
your cell phone! Your life counts”) at the International Motor
Show (IAA) in Frankfurt. The declared aim is to inform about
the high risk of accidents and losing your life through being distracted when driving. More than half of all drivers who own acell phone regularly use it while driving. This is the result of a
Forsa survey commissioned by DEKRA. According to the report,
55 % use their smartphones every now and again while at thewheel. At any given time, an average of 7 % of drivers are distracted from driving by their cell phones. This was determinedby DEKRA accident research in a nationwide traffic survey.
The DEKRA traffic safety report (TSR) was presented forthe tenth time in the fiscal year 2017. The DEKRA TSR, published annually since 2008, provides up-to-date information andadvice on the further development of road safety for decision-makers in politics, associations and companies. The multilingual report has met with a good response for years, not onlyin Brussels and Berlin, but also in many other cities such as
Madrid, Paris, Rome and Beijing. The DEKRA TSR 2017 focuseson tried-and-tested road safety measures in various countries allover the world to increase road safety. DEKRA shows just how
many different ways and means are available to sustainably
reduce the number of accident victims on the roads and how
success stories can be transferred to other countries.
DEKRA TSR is flanked by the DEKRA online portal, set
up in 2016, on road safety: www.dekra-roadsafety.com. Additional content in the form of videos or interactive graphics supplement the printed report. The portal is also concerned withmany other topics relating to road safety, including vehicle technology, infrastructure or the human factor of being distracted
by smartphones when driving.
DEKRA has been accompanying the technological developments in the automotive sector for many years. The development towards the mobility of the future represents a special challenge for all players in the automotive industry. Therefore,
DEKRA has created a team to develop services for the connected
car that pools the whole range of knowledge gained from laboratory tests through material testing to homologation and typeapproval, across organizational and national borders.

DEKRA

In the fiscal year 2017, DEKRA took over the Lausitzring in Klettwitz, Brandenburg, Germany, and combined it with the adjacent DEKRA Technology Center to further expand its expertisein the mobility of the future. This largest manufacturer-independent test and inspection center in Europe for automated andconnected driving further expanded DEKRA’s international test
network in Klettwitz, Málaga and in laboratories in China. In
Spanish Málaga the current focus is on secure connectivity andelectromagnetic compatibility of cell phones, smart home products and Industry-4.0-applications as well as a test area for connected driving. The focus there is on product testing, the development of early-stage test procedures and the testing of V2X
technologies (Vehicle-to-Everything). In addition, the site in
Málaga is already getting ready for the technology of tomorrow,the 5G mobile communications standard.
In early 2017 in Hsinchu, Taiwan, DEKRA’s largest laboratory for autonomous and electrical mobility services opened.
The focus there is on inspecting and certifying automotive partsand components.
As part of its research and development activities, DEKRA
initiated a project in Stuttgart at the beginning of 2017 to reduce
the highest levels of respirable dust pollution, particularly at
Neckartor. A large-scale cleaning trial was started together withthe city of Stuttgart and the street cleaning specialists of thecompanies Faun, Kärcher, Reuther, Oberheiden and Stuttgart
municipal waste management (AWS): targeted, regular andintensive street cleaning can remove a high proportion of particles. DEKRA accompanied the trial with comprehensive measurements and laboratory analyses. Street cleaning can make aneffective contribution to reducing fine dust on busy streets inlarge cities. That was the conclusion DEKRA came to following
a trial in Stuttgart lasting approximately five weeks in March andApril 2017. To obtain more detailed analyses of the impact on
the fine dust values, street cleaning will continue in winter2017/18.

Financial Report 2017

The radical changes brought about by digitization also lead toprofound changes in career and training profiles and revolutionize the methods of teaching and learning. DEKRA AkademieGroup is a provider in the education sector that is keen to shapeand support these trends. One example is a project in the area of
e-mobility: Deutsche Post DHL relies on electromobility and isalready using more than 5,000 electric StreetScooters. The tests
to obtain EG type approval were carried out by the DEKRA
Technology Center in Klettwitz. Within the space of a few
months, DEKRA has provided specialist training to the employees of a repair shop chain in customer-specific handling of
high-voltage vehicles in order to ensure the necessary maintenance and repairs of e-StreetScooters.
REPORT ON ECONOMIC POSITION

General economic and industr y-specific conditions
Global economy growing

Global economic growth accelerated in 2017. According to dataof the World Bank, the global gross domestic product (GDP) of
3.0 % was 0.6 percentage points above the prior-year level (2.4 %).
Developing and emerging economies generated the highest
growth at 4.3 % (prior year: 3.7 %). Industrialized countries
achieved an increase of 2.3 % (prior year: 1.6 %). In the euro zone,
GDP increased by 2.4 % compared to the prior year (1.8 %).
Unemployment fell to its lowest level in years, both in theeuro area and in the EU28 countries. In the euro zone countries,
at 8.7 % in December 2017, it remained below the figure of thesame month in the prior year (9.7 %). According to calculations
by the statistical office of the European Commission(EUROSTAT), the unemployment rate in the EU28 was also
down on the prior year at 7.3 % in December 2017 (prior year:
8.2 %). Overall, around 18 million people were unemployed in
the EU28 in December 2017. The Czech Republic (2.3 %) andGermany (3.6 %) recorded the lowest levels. Unemployment was
highest in Greece (20.7 %) and Spain (16.4 %).
According to EUROSTAT, inflation in the euro zone rose
year-on-year from 1.1 % in the prior year to 1.4 % in December
2017. According to the German Federal Statistical Office, consumer prices in Germany rose by 1.8 % in December 2017 compared with December 2016.

DEKRA

07

Good framework conditions for DEKR A

The automotive industry, of such importance for DEKRA, also
reported growth in 2017. According to data provided by the VDA[“Verband der Automobilindustrie”: German Association of theAutomotive Industry], the number of passenger car sales inWestern Europe was up almost 2.5 % on the prior year. Of the
14.3 million units, 3.4 million units were sold in Germany alone,
up 3 % on the prior year. The US market fell by 1.9 % to 17.1 million units. The development in China was positive where theprior year’s passenger car sales volume increased by 2 %. Withsales of new vehicles of 24.2 million units, the People’s Republicof China is the world’s largest passenger car market.
DEKRA Industrial business is influenced by the German
and international industrial economy. Economic impetus inEurope, robust development in China, an upturn in the US economy and stabilization in the emerging markets created a positiveenvironment for German industry and for DEKRA in 2017.
According to the German Chemical Industry Association [“Verband der Chemischen Industrie”: VCI], for example, the sector
companies increased production significantly, achieving revenue
growth of 5.5 %. Overall, German industry is in very good shape,
exports continued to develop favorably. According to the German Federal Statistical Office, export growth stood at 6.3 % in2017. The continuous recovery of the price of oil will provide
further growth impetus in the core industry services.
The factors most relevant for DEKRA Personnel are theaward of public sector contracts and the demand for temporary
workers. According to the latest data provided by the German
Federal Employment Agency [“Bundesagentur für Arbeit”], themoving average number of temporary workers in Germany from
July 2016 to June 2017 was approximately one million. The number of temporary employment agencies compared to the prioryear rose by about 1 % to 52,700. In a highly fragmented market,
approximately three quarters of all agencies have fewer than ten
temporary workers. In view of the changing demands on thequalifications of the employees, the Bundesagentur für Arbeit
also budgeted around 1.7 billion euros in the promotion of vocational training in 2018.

Financial Report 2017

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GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Report on Economic Position

Report on Economic Position

Business performanceGroup
Solid global positioning ensures growth

In the fiscal year 2017, DEKRA benefited from the global position and people’s long-term need for more safety at work, athome and on the road. Revenue increased by 8.0 % to 3.1 billion
euros. Headcount increased by 4,700 to 44,057 (prior year:
39,357) through strong organic growth and acquisitions.
DEKRA further improved its earnings before interest and taxes(EBIT) from 181.0 million euros in the prior year to 203.0 million euros in the reporting year.
DEKR A Automotive
Firmly on track

As one of the world’s leading providers of automotive services
in the TIC industry, the Business Unit DEKRA Automotive
increased its revenue by 3.8 % to 1,557.5 million euros. In boththe Vehicle Inspection and Homologation & Type Approval service lines, as well as in the Automotive Solutions service unit,
business grew on both a national and international scale. The
Expertise Service Line also grew. In the fiscal year 2017, 30.8 %(479.4 million euros) of the revenue was generated abroad compared to 31.2 % (468.3 million euros) in the prior year.
REVENUE DEKRA AUTOMOTIVE
worldwide in million euros

1,501

2016

1,558

+3.8 %
Revenue increase

DEKRA Automobil GmbH in Germany contributed 1,211.8 million euros to group revenue, an increase of 5.5 % on the prioryear (prior year: 1,148.5 million euros). This included around
168.9 million euros from industry testing services rendered by
DEKRA Automobil GmbH and reported in the Business Unit
DEKRA Industrial. This represents an increase in revenue ofmore than 12.7 % (revenue 2016: 149.9 million euros). The strong
market position is reflected, for example, in elevator and pressure tank inspections. The position of market leader in the corebusiness of vehicle inspection in Germany was consolidated,with more than 11.3 million inspections and a market share of
approximately 34 %. In order to continue to be a leader in thisimportant business field, investments in new and modern test
centers and measuring equipment were again made in 2017.
DEKRA is the market leader, testing around 26 million
vehicles worldwide. The global vehicle inspection business developed well. DEKRA increased its number of test centers in many
countries: in Portugal, for example, after entering the main market in 2016, the test center network was significantly expanded
by taking over eleven stations. DEKRA now operates 14 stations
in Portugal and has taken a major step towards its goal of becoming one of the top three providers in the country by 2020. In
France, DEKRA’s second home after Germany, DEKRA captured
additional market share in the regular vehicle inspection business. Moreover, a leading French business magazine selected
DEKRA as the leading brand in vehicle inspection. The first test
station was inaugurated in Luxembourg in December and customer operations will start on February 1, 2018.
Business in inspection and other automotive services
developed positively in markets such as Sweden, South Africa,
the Czech Republic and Slovakia. Business in New Zealand also
reported growth. The Service Unit DEKRA Automotive Solutions was successful, with services in used car management andin after sales, and generated revenue of 188.9 million euros (prioryear: 178.0 million euros). Operations in France, Germany, Italy
and the Netherlands were particularly successful.

Innovative digital technologies are employed for used car management, expertises and claims adjustment. This ranges from theuse of drones in the preparation of accident analysis reports, theanalysis of building damage through to digital data management
via an app for leased car returns.
DEKR A Industrial
Well - positioned in growth areas

Despite a somewhat challenging economic environment in a
number of regions and markets, Business Unit DEKRA Industrial has done well thanks to its strong market position and services it offers for the digital world. Revenue increased by 5.3 %to 896.4 million euros. This includes 168.9 million euros (prioryear: 149.9 million euros) from regular industry testing services
in Germany rendered by DEKRA Automobil GmbH via its Germany-wide network of branches. In total, the Industrial andConstruction Inspection Service Line generated revenue of
405.8 million euros (prior year: 378.0 million euros). In addition
to Germany, the important French market also contributed to
growth, generating revenue of 240.9 million euros (prior year:
232.0 million euros).
REVENUE DEKRA INDUSTRIAL
worldwide in million euros

851

2016

896
+5.3 %
Revenue increase

The Product Testing & Certification Service Unit responded tothe challenges posed by the Internet of Things and digitizationof mobility and now has a global network of test laboratories.
For example, the laboratory in Shanghai, China, provides a variety of high-tech testing services under one roof with a particularfocus on the fast growing requirements of the automotive industry. This includes chemical analyses, material testing, safety tests
and certifications, electromagnetic compatibility tests as well as
reliability tests and damage analyses. The laboratory in Linkou,
Taiwan, provides cutting-edge technologies and state-of-the-art
services with a particular focus on connectivity.
An important topic is cyber security. Here DEKRA wasable to strengthen its market position in the evaluation andauditing of IT-security standards by taking over the Spanish specialists Epoche & Espri. In addition to other international regulations, the company with registered offices in Madrid, Spain,
focuses on certification according to Common Criteria and FIPS
(Federal Information Processing Standard), the leading methods
to evaluate the cyber security of products and software.
In the equally strategically important power and energy
market, the Service Unit improved its position with the acquisition of the Hungarian high power and high voltage laboratory
VEIKI-VNL. VEIKI-VNL, based in Budapest, Hungary, is specialized in the testing and certification of electrical transmission
and distribution equipment. It offers a broad range of services
including high voltage testing, temperature rise testing, as well
as aging tests.
The strategic acquisition of the specialist Core Visual
Inspection Services with registered offices in Charlotte, North
Carolina, USA, enabled the Service Unit Materials Testing &Inspections to enter the inspection and testing business for
power plants in the USA. This success marks another important
step in DEKRA’s strategy to be present as a global partner with
its services on all continents.

2017

2017

DEKRA

Financial Report 2017

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Financial Report 2017

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GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Report on Economic Position

Report on Economic Position

In the Service Unit Business Assurance the integration of AQS
Managements Systems, Minnesota, USA, acquired in 2016 wascompleted according to plan. Thanks to AQS, DEKRA has
become a leading provider of training and courses for systemmanagement in the US. In addition – as in other Service Units– competence in the future field of cyber security was expanded,in keeping with standard ISO 27001 for data security.
DEKRA Industrial France has developed well; the turnaround has been completed and the Company is back on a
growth course.
DEKR A Personnel
Exper t for education and temporar y work

The revenue of the Business Unit DEKRA Personnel grew by
24.8 % to 650.1 million euros in 2017. Both the Temporary Work
Service Unit of DEKRA Arbeit Group and the Training & Education Service Line of DEKRA Akademie Group contributed tothis success.
REVENUE DEKRA PERSONNEL
worldwide in million euros

650+24.8 %
Revenue increase521

In the case of personnel services, DEKRA Arbeit Group
maintained its position as the seventh largest temporary employment and personnel service company in Germany and increased
its revenue significantly to 396.9 million euros (prior year:
302.0 million euros). DEKRA is now successful in 14 other European countries beyond its home market of Germany. Bulgaria
was added as a location in 2017. The opening of additional locations abroad, such as in France and Austria for example, is alsoplanned in 2018. At its peak, more than 17,000 temporary workers were employed in 2017. New framework agreements wereconcluded with existing and new clients in 2017 thanks to
DEKRA’s leading position in the temporary hire of employees.
The Training & Education Service Unit has succeeded in
expanding the commercial customer business and foreign business, for example in the area of occupational safety and fire protection. Revenue from training in fire safety alone increased tenfold in the past two fiscal years. Projects for the training andeducation and placement of nursing staff from different European countries for German hospitals and nursing homes continued to develop positively. The first skilled workers from southeast Europe are being prepared for their transfer to Germany. A
total of 2,500 participants from eastern European countries werein training at the end of 2017. In the growth market for online
training and education DEKRA registered a strong demand for
its online training portal DEKRA Safety Web. On top of this,additional blended learning offers combining virtual lessons andclassroom training were expanded further.
Overall statement by management

2016

In 2017, DEKRA recorded growth for the fourteenth year in arow. In the fiscal year 2017, the increase in revenue was largely
the result of organic growth. The Company’s large footprint interms of expertise and geographies enables it to compensate for
economic and regulatory challenges in individual business segments through growth in others. Thanks to its global presence
and thought leadership, DEKRA will participate in the global
trend towards more technical and organizational security. The
chances of sustainable and stable growth remain good.

2017

DEKRA

Financial Report 201711

Environmental protection and sustainabilit yEnvironmental protection

Sustainabilit y management

Protecting the environment is a matter of course for DEKRA:
Because the protection of the environment and its resources ispart of DEKRA’s understanding of safety. Internal environmental management is managed by the Environment, Health and
Safety (EHS) corporate unit and works worldwide to further
optimize environmental protection and resource efficiency at
DEKRA. A group-wide guideline for environmental protection
and occupational health and safety was adopted in 2017. DEKRA
employees receive regular training in environmentally friendly
behavior and their awareness for environmental protection
issues sharpened. What is more, DEKRA offers expert services
in the area of environment and energy, thus also contributing toenvironmental protection outside the Company.

In the fiscal year 2017, DEKRA continued the accelerated development and expansion of sustainability management in the
Company of the prior years and continued the development of
an individual sustainability profile. The focus lay on the preparation and implementation of the requirements of the German
Sustainability Code (GSC) and the structural enhancement ofcommunication with the Company’s stakeholders via the new
DEKRA sustainability magazine. Furthermore, the foundations
were laid for meeting future and current requirements, including
those in the areas of the supply chain, social standards and environmental management.
The Sustainabilit y Code

DEKRA has officially fulfilled the requirements defined by “TheSustainability Code” since May 5, 2017. It is an important stepfor DEKRA to underscore so credibly the sustainability performance of the Company. This is also demonstrated in positive
sustainability ratings received by DEKRA, for example from
EcoVadis (Silver Recognition Level 2017).
Business model sustainabilit y

As a company, DEKRA benefits from sustainable developmentin the economy, environment and social responsibility. With its
expert services, the Company aims to make a contribution tosustainable development. Services in the areas of sustainability
and corporate social responsibility (CSR) have become highly
relevant in view of increasingly complex regulatory conditions
and rising political and social expectations. DEKRA helps promote safety in the environment and society through the expert
services it offers. These are complemented by the large numberof CSR-specific services offered by the sustainability specialist
team.

Personnel repor t
Headcount reaches record highAt the end of 2017, with 44,057 employees the threshold of
40,000 employees was exceeded for the first time. The prior-year
figure of 39,357 was thus clearly surpassed. As in prior years thenumber of employees at the end of the reporting year rose by
4,700 (prior year: 2,684) or by 11.9 % (prior year: 7.3 %).
In Germany, the headcount rose by 13.2 % compared tothe prior year (prior year: 5.2 %) from 20,050 to 22,693. The
employment situation in temporary work as well as in theregional automotive and industrial business had a positiveeffect here. In Europe (excluding Germany), the headcountrose from 14,034 to 15,709 (up 11.9 %, prior year: up 10.8 %).
There were very positive developments to be seen here, among
others in France (up 152), Portugal (up 128), Spain (up 667) and
Denmark (up 230). Outside Europe, DEKRA grew from 5,273 to
5,655 employees and thus by 7.2 % (prior year: 6.5 %).
Disclosures on the propor tionate representation of women
on executive boards

Targets were set for the number of women represented on themost important corporate bodies in first- and second-tier management. The target figure for the composition of the Supervisory Board of DEKRA SE is 16.7 %. This quota has been reached.
For the Executive Committee and the Management Committee,
quotas of 15 % and 20 % have been defined. The target figure for
the Executive Committee was reached (15.8 %) while that for theManagement Committee was nearly met and the latter will beattained in the medium term.
DEKRA

Financial Report 2017

12

GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Report on Economic Position

Report on Economic Position

Spotlight on employee orientation

Management development

Financial position and performance

The reporting year was marked by many topics derived from
Vision 2025. The first-time implementation of a global employee
survey was one of the highlights. 26,000 employees in 38 countries in total were asked about their specific work situation. The
response rate was 64 %. Overall the survey includes not only
statistical analyses but also the elaboration of follow-up measures that the Company should further develop in terms ofimpact and employer attractiveness. Corresponding measures
were defined on a team level in team dialogues between management and its employees. In a further step, overarching measures will be derived from these results, which will be applied at
the plant or company level. Since the employee survey is intended
as a management instrument, it will be carried out on a regularbasis in the future. The quality of the worldwide implementation
was supported by a package of measures including speciallydeveloped media packages and interactive self-learning modules
for managers.
The code of values developed as part of Vision 2025 wasdeliberately reflected on by management and employees in 2017
and transferred to the own work area. DEKRA People Values
workshops designed for this purpose were conducted by theManagement Board for all levels of management. This supported
the general objective of bringing DEKRA even closer together
through a uniform global value orientation in order to achieve
the goals of Vision 2025.
A partner for a safe world also takes care of the safety of
its own employees in all areas of work. In order to prepare forpossible risks during business trips or to be able to quickly obtainsupport in emergencies on business trips and assignments, a
respective partnership was entered into with an external service
provider. Since 2017, all employees worldwide have had access toa web-based information and transaction portal at all times. This
service is supplemented by automated travel information and asingle emergency number for the whole world which is available
around the clock and can be called in the event of related emergencies.

Vision 2025 and the derived strategy, as well as recently developed global harmonization policies, guidelines and processes
increasingly make a contribution to the integration of the
DEKRA Group. This was the prerequisite for global management
training to be offered in a uniform DEKRA format for the firsttime in 2017. As part of the DEKRA Managerial Foundation
Program over 200 managers from middle management weretrained in the reporting year to reflect on the above standards
and their concrete implementation in day-to-day management.
We are thus supporting a uniform DEKRA management culture
including the ability to actively shape change and transformation. Trainings mainly took place outside Germany. In addition
to training programs in China, France, South Africa, Italy,
Spain, the USA and Brazil, which were held in the local language,
seven international training sessions took place for managers
from various countries. The training series will be continued in2018 with the focus on management from German entities andadditional managers participating in international formats. By
the end of 2018, all managers from middle management (about
350 worldwide) will have participated in the Managerial Foundation Program.

Financial performance

Up - to - date personnel recruitment

Of this growth 7.7 % (prior year: 5.5 %) was achieved throughorganic growth and first-time consolidations while 0.3 % of thisrevenue growth in 2017 (prior year: 1.2 %) stems from the acquisitions in the fiscal year and full consolidation of entities
acquired during the prior year. Changes in exchange rates
reduced revenue by 0.1 % (prior year: negative effect of 0.5 %).
The increase in revenue in the Business Unit DEKRA
Automotive was primarily due to revenue generated in Germany
where the volume in vehicle inspection and expertise developed
very positively compared to the prior year. In the Business Unit
DEKRA Industrial, significant revenue increases were reported
in the Industrial & Construction Service Line, especially in Germany and France, as well as in the Product Testing & Certification Service Line. In the Business Unit DEKRA Personnel, revenue in the Temporary Work service line was increased by afurther increase in market share and the continued good economic situation. The training and education business was also
increased internationally.

DEKRA

DEKRA will continue to grow and is competing with manyother companies for the best talent. In order to better satisfy therequirements of modern recruitment processes, these have beenrevised and supplemented with new, modern tools. A multilingual and responsive “e-recruiting portal” facilitates the application process at DEKRA and creates transparency across all process steps. It has been rolled out in Germany first. The
recruitment tools and processes will be rolled out step-by-stepin other countries in connection with global SAP introduction.

Financial Report 2017

The DEKRA Group increased its revenue by 231.2 million
euros in the fiscal year 2017 (prior year: 183.3 million euros) to
3,134.8 million euros (prior year: 2,903.6 million euros), whichis equivalent to a revenue increase of 8.0 % (prior year: 6.7 %).
This means that the 2017 revenue target was met in full.
GROUP REVENUE
worldwide in million euros

2,904

2016

3,135
+8.0 %
Revenue increase

2017

DEKRA

13

Of the revenue, 1,901.3 million euros (prior year: 1,739.9 million
euros) relates to Germany, 396.2 million euros (prior year:
379.7 million euros) to France and 837.3 million euros (prioryear: 784.0 million euros) to other countries.
Other operating income increased by 4.0 million euros to
31.9 million euros (prior year: 27.9 million euros).
At 2.0 % the increase in cost of materials was significantly
below that in revenue. The ratio of cost of materials to revenue
thus decreased to 9.8 % (prior year: 10.4 %).
Personnel expenses increased by 10.3 % to 2,021.6 million
euros (prior year: 1,832.4 million euros). Personnel expenses asa percentage of revenue increased from 63.1 % to 64.5 % in thefiscal year 2017, primarily as a result of strong growth in temporary work.
At 3.4 %, other operating expenses grew more slowly thanrevenue, corresponding to a decrease in the ratio of expenses torevenue of 0.8 percentage points to 17.7 % (prior year: 18.5 %).
This was mainly due to lower expenses for bad debt allowances
and a disproportionately small increase in rent and building
costs, and administrative costs in comparison to the prior year.
The depreciation volume matched the prior-year level with
88.2 million euros (prior year: 88.0 million euros).
Operating profit – calculated as earnings before taxes andthe financial result – improved by 12.2 % to a total of 203.0 million euros (prior year: 181.0 million euros). This was fully in linewith the expectation for the fiscal year that the Group’s operating
profit would again improve in comparison to the prior year.
Return on sales, calculated in relation to operating profit,
increased by 0.3 percentage points to 6.5 %.
The improvement in the financial result by 12.8 million
euros to –10.5 million euros is largely due to income from thedisposal of financial assets of 6.5 million euros, 3.6 million euros
lower interest expenses from loans as well as from the positiveeffect from measurements in foreign currencies totaling 0.5 million euros (prior year: –1.7 million euros).
Earnings before taxes rose 22.1 % to 192.5 million euros(prior year: 157.7 million euros). Return on sales, calculated in relation to income before taxes, increased to 6.1 % (prior year: 5.4 %).

Financial Report 2017

14

GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Report on Economic Position

Report on Economic Position

R E C O N C I L I A T I O N O F A D J U S T E D E B I T A N D E B T F O R 2 017
in million euros

+6.0

+4.3

+1.0

+0.8
+3.3

236.1

+21.0

228.9

–10.5

203.0

EBIT 2017
unadjusted

PPA
impairment

Project costs

Restructuring
expensesOthereliminations

Integration andtransaction costs

EBIT 2017adjusted

Financial result
unadjusted

Eliminations fromfinancial result

EBT 2017
adjusted

R E C O N C I L I A T I O N O F A D J U S T E D E B I T A N D E B T F O R 2 016
in million euros

+6.8

+3.5

+0.3

+7.1

+3.6
200.9

–23.3

181.0

PPA
impairment

Project costs

Restructuring
expensesOthereliminations

DEKRA

Integration andtransaction costs

Financial Report 2017

EBIT 2016adjusted– Exchange rate effects in relation to loans within the Group(effect on the financial result),– Special effects from the measurement of put and call options(effect on the financial result).
Adjusted operating profit rose by 7.0 % (prior year: 9.7 %) to
236.1 million euros (prior year: 220.6 million euros). As a result,the margin for the adjusted operating profit fell by 0.1 percentage
points to 7.5 % The adjusted operating profit before taxes
increased by 0.4 percentage points and stands at 7.3 % in the fiscal year (prior year: 6.9 %).
Financial position
Financial management

The significant principles and goals of the DEKRA Group’s
financial management are described in the notes.
Capital expenditure

Capital expenditure on property, plant and equipment andintangible assets in the fiscal year 2017, excluding business combinations, amounted to 89.2 million euros (prior year: 81.2 million euros). Spending mainly related to land and buildings, technical and other equipment, furniture and fixtures as well as
intangible assets. Most capital expenditure was carried out by
DEKRA Automotive and DEKRA Industrial.
Liquidit y analysis

220.6

+21.9

EBIT 2016
unadjusted

The Group tax rate fell 0.6 percentage points on the prior year to
31.0 % (prior year: 31.6 %). The decline is due mainly to slightly
lower non-deductible expenses and a disproportionate increasein tax-free income.
The consolidated net income for the fiscal year 2017
increased by 25.0 million euros to 132.8 million euros (prioryear: 107.9 million euros).
Other comprehensive income increased by 18.3 million
euros to –17.2 million euros in 2017 (prior year: –35.5 million
euros). This positive development is mainly due to changes to theactuarial parameters for pension obligations. The interest rate
remained at 1.75 % (prior year: 1.75 %) in the fiscal year. Changes
to the actuarial parameters for pension obligations resulted in
an improvement of 4.6 million euros in other comprehensive
income (prior year: decrease of 42.3 million euros). In contrast,
the reserve for currency translation declined by 19.0 million
euros (prior year: increase 5.2 million euros), which mainly concerns the subsidiaries in the USA, New Zealand, Brazil, Taiwan
and Sweden. This was countered by currency translation effectsof subsidiaries in the Czech Republic. This results in total comprehensive income, taking into account expenses and income
recognized directly in equity, of 115.7 million euros (prior year:
72.4 million euros).
To aid comparison of the operating result, the operating
result and earnings before taxes for 2017 and 2016 were adjusted
for the following non-operating (special) effects:

15

Financial result
unadjusted

Eliminations fromfinancial result– Amortization of intangible assets identified as part of a purchase price allocation (PPA amortization),– Project costs for the significant improvement of the Group’s IT
infrastructure, as well as for market entries in new countries
or business segments,–R estructuring expenses, M&A costs and integration costs,– Earnings from the sale of entities and individual items of property, plant and equipment, as well as from the subsequent
measurement of purchase price components (earn-out agreements) and from purchase price reimbursements,

The development of the DEKRA Group’s liquidity in the fiscal
year 2017 was heavily influenced by the improved operating
result and the use of cash and cash equivalents as collateral for
pension obligations.
At 104.3 million euros (prior year: 209.3 million euros),
cash flow from operating activities does not fully reflect the gooddevelopment of business in the course of the reporting year. The
decrease in long-term accrued liabilities of 66.8 million euros(prior year: 6.0 million euros) is influenced by the initial allocation to a contractual trust arrangement (CTA) as collateral for

EBT 2016
adjusted

DEKRA

Financial Report 2017

16

GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Report on Economic Position

Risk, Opportunities and Forecast Reportpension obligations. Cash and cash equivalents of 59 million
euros were used for this purpose. In addition, working capitalrecorded a cash outflow of 41.7 million euros (prior year: inflow
6.0 million euros) due to cut-off effects. These are mainly attributable to increased trade receivables resulting not least from theincrease in revenue of the Business Unit DEKRA Personnel. In
contrast, the improved operating result adjusted for non-cash
income and expenses had a positive effect on the operative cashflow.
The net cash outflow from investing activities came to 130.1 million euros (prior year: 104.6 million euros). The increase is influenced by the continuing high level of investment in property,
plant and equipment and intangible assets. Furthermore, thelevel of investment in business combinations and equity investments increased year-on-year.
The net cash outflow from financing activities came to
31.9 million euros (prior year: 60.1 million euros). The cash outflow results from the profit transfer of 37.3 million euros (prioryear: 29.4 million euros) to DEKRA e. V. as well as from thechange in the cash pool of 21.1 million euros (prior year: 1.0 million euros) due to cut-off effects. The remaining change in cash
outflow is mainly due to interest and principal payments ofloans. This was offset by an equity contribution of 30.0 million
euros (prior year: 15.0 million euros).
Cash and cash equivalents (consisting of checks, cash in
hand, bank balances and other cash equivalents) decreased by
59.4 million euros to 76.4 million euros (prior year: 135.8 million
euros).
Composition of assets, equit y and liabilities

Total assets fell by 1.1 million euros (prior year: increase of
114.0 million euros) from 2,091.3 million euros to 2,090.2 million euros in the past fiscal year. The decrease is due to the setting up of a CTA to secure pension obligations. The assets transferred to the CTA qualify as plan assets and are recognized inpension obligations.
Non-current assets increased by 13.2 million euros to1,239.4 million euros (prior year: 1,226.2 million euros). Current
assets, on the other hand, decreased by 14.4 million euros to850.7 million euros (prior year: 865.1 million euros).

DEKRA

Under non-current assets, property, plant and equipment
increased by 8.3 % to 314.8 million euros (prior year: 290.6 million euros). This increase is largely due to the acquisition, construction and modernization of properties for the Group’s own
use as well as from the acquisition of land. Contrary to this,other long-term financial assets decreased as a result of theassignment of special funds to the CTA.
The decrease in current assets mainly stems from thedecline in cash and cash equivalents by 59.4 million euros(prior year: increase of 46.2 million euros). Moreover, thedecrease in other current financial assets by 31.3 million euros
to 173.3 million euros affects current assets (prior year: increaseof 7.4 million euros). In contrast, trade receivables increased by
66.7 million euros to 526.6 million euros. As a result of isolated
increases seen in some business segments and regions due to
end-of-period effects, days receivable outstanding at group level
were prolonged by around one day to 61 days (prior year: 55days), resulting in an increase in receivables at a higher rate thanrevenue (14.5 %).
Equity increased by 92.0 million euros to 635.5 million
euros (prior year: 543.5 million euros). This is largely attributable to the consolidated net income for the year of 132.8 million
euros (prior year: 107.9 million euros). The transfer of profits to
DEKRA e.V. and the addition to the capital reserves by
DEKRA e.V. in the fiscal year came to 54.0 million euros (prioryear: 37.3 million euros) and 30.0 million euros (prior year:
15.0 million euros) respectively. Moreover, recognizing theremeasurement of pension provisions through profit or loss lessdeferred tax assets of 4.6 million euros (net) increased equity(prior year: decrease 42.2 million euros). Currency translation
effects reduced equity by 19.0 million euros (prior year: increase
5.2 million euros). The equity ratio increased to 30.4 % from26.0 % in the prior year.

Financial Report 2017

Non-current liabilities fell by 18.9 % to 780.7 million euros (prioryear: 962.1 million euros), largely due to the decrease in pension
provisions of 136.7 million euros (prior year: increase of
52.2 million euros). This is mainly due to the initial allocationof 122.2 million euros to the CTA to secure pension obligations
and the associated offsetting of the plan assets against the pension provisions. In contrast, the increase in pension provisionsof 11.7 million euros (prior year: 79.9 million euros) affects
non-current liabilities. The increase in current liabilities by
15.1 % from 585.7 million euros to 674.0 million euros is theresult of maturity-related changes concerning loan payables andan increase in liabilities to employees due to end-of-period
effects. The current and non-current liabilities are mainly
denominated in euros.
In the fiscal year, loans against promissory notes due in2018 were reclassified from non-current to current liabilities.
Refinancing is planned for the following fiscal year.
The DEKRA Group requires sufficient liquidity for futureacquisitions, which is ensured by the promissory notes and by
longer-term loan commitments. As of December 31, 2017, there
are medium-term credit lines of 325.1 million euros granted inwriting that have not yet been drawn.

17

RISK, OPPORTUNITIES AND FORECAST REPORT

Risk repor t
Systematic management of transparent risks

As part of its planning and control process, DEKRA leverages
an established risk management system in order to systematically identify potential risks and to rate the probability as high,moderate or low.
QUANTIFIC ATION OF RISKS

Loss potential in million euros
Going concern risk
>100 million euros
Severe loss
20–100 million euros
Medium loss
5–20 million euros
Low loss
1–5 million euros
Unlikely
0–10 %

Possible
11–25 %

Medium risk  

High risk

Probable
26–50 %

Highlyprobable
51–100 %Probability in %Summar y assessment of financial positionand performance

Low risk  

The DEKRA Group’s financial performance in the fiscal year2017 was very good, exceeding both expectations and prior-year
developments. The financial position allows sufficient headroom
for the Group to pursue its goals.

DEKRA

On this basis, the management levels responsible promptly
develop countermeasures. The Management Board is regularly
informed through defined reporting channels. DEKRA communicates particularly urgent issues at short notice via internal ad
hoc announcements. DEKRA’s risk management system, which
again proved its worth in 2017, is continuously amended in
response to changes in legal and economic conditions. In thefollowing, we outline and assess the risks that, from today’s perspective, could have a significant influence on DEKRA’s financial
position and performance. The individual risks have increasedslightly in comparison to the prior year.

Financial Report 2017

18

GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Risk, Opportunities and Forecast Report

Risk, Opportunities and Forecast Report

Environment and industr y risks

Business strategy risks

Political, regulatory and economic conditions are very important
to DEKRA’s success as an expert organization with global operations. Changes in circumstances may give rise to risks relating
to revenue and income. That is why DEKRA always closely monitors its markets and industries.
The Business Unit DEKRA Automotive is exposed to thegeneral regulatory risk for vehicle inspection in the EU. This risk
is currently deemed to be low. However, fierce competition andchanging technologies in the important Vehicle Inspection Service Line pose a moderate risk as cost increases can be passed on
to the customers only to a limited extent. DEKRA lowers thisrisk by constantly improving productivity based on optimized
processes and new technologies to ensure more road safety andfewer traffic fatalities.
The economic outlook also determines the willingness toinvest of customers of the Business Unit DEKRA Industrial. The
risk of a drop in orders grows with real or suspected economic
uncertainty. This is the case, for example, for the Material Testing & Inspection and Insight Service Units. DEKRA prepares
itself for these risks, which it classifies as low, by expanding its
service offering and increasing the globalization of its business.
The Business Unit DEKRA Personnel is particularly
dependent on the economy. This applies to both the employee
leasing activities of the Temporary Work Service Line as well as
training opportunities in the Training & Education Service Line.
In both these areas, revenue and earnings may be affected byfluctuations in orders caused by cyclical developments. DEKRA
combats these risks, which it classifies as moderate, by moving
into new markets, broadening its portfolio of services and making customized offers. New statutory regulations may lead tohigh risks in the Temporary Work Service Unit. The new German AÜG [“Arbeitnehmerüberlassungsgesetz”: Law on Temporary Employment], which came into force on April 1, 2017, willaffect the entire temporary employment market. The legal
requirement of equal pay applies from January 1, 2018, and thelimitation of temporary work to 18 months, with a few exceptions, will apply as from October 1, 2018. DEKRA is responding
to these regulatory interventions in the employee leasing markets by building up its business with key accounts and by investing in its position as a quality provider.

DEKRA will continue its policy of organic growth supplemented
by targeted acquisitions. DEKRA broadens its footprint in termsof both expertise and geography by means of strategic acquisitions. However, the integration of acquired companies may failor be delayed. Budgets may be unrealistic and synergy effects
unattainable. These risks are also classified as medium, as is theresulting risk that could arise for the portfolio of services andthe Group’s general performance on the market. There are alsomeasurement risks for capitalized assets. Such risks are classified
as low for the Business Units DEKRA Automotive and DEKRA
Personnel and medium for DEKRA Industrial. Overall, DEKRA
counters business strategy risks with professional project andintegration management.
The regulatory frameworks in other non-European countries differ from the conditions in Germany and Europe. As aresult, the ongoing internationalization of business entails –albeit low – liability risks and risks to the Group’s reputation.
That is why DEKRA is constantly working to enhance its risk
and compliance management activities. This includes the ongoing adjustment of the liability protection offered by insurance
policies to changing circumstances.

DEKRA

Operating risks

Accreditations and official authorizations are important factors
on which DEKRA’s success depends. With its internal monitoring system for safeguarding service quality and by means of
insurance, DEKRA reduces risks arising from liability for its
inspections, expertises, certifications and seals. Risks arisingfrom missing or amended government authorizations are mitigated by targeted committee work. This allows changes to laws
and standards to be identified in time and DEKRA services tobe rapidly adapted. Particularly important in this context is theoften time-consuming training and education of the examiners
and inspectors as well as the timely planning and provision of
the necessary equipment.

Financial Report 2017

The adjustments to the national regulations in Germany
demanded by Germany’s national accreditation body (DAkkS)
in recent years specifically concerned the handling of test andmeasurement equipment. In Germany, national requirements
for the main inspection previously required that test and measurement equipment be regularly gauged, calibrated and individually tested in accordance with various different standards.
The standard to be audited by DAkkS requires consistentISO-compliant calibration. A certification procedure was therefore introduced in 2016 that prescribes a mandatory step-by-step
program for the universal implementation of the ISO 17020
standard and the respective necessary ISO-compliant calibration
for all test and measurement equipment. This also concerns thetest and measurement equipment used in test centers. DEKRA
has already developed all necessary calibration procedures tosuch an extent that all accreditation by DAkkS have so far been
completed successfully.
In a first step of the step-by-step program, two pilot test
centers of every inspection organization were assessed by DakkS
in accordance with the DIN/ISO standard 17020-2012. This
assessment by DAkkS was successfully completed for DEKRA
in June 2017.
The measures needed to adjust and implement the calibration procedure have been initiated.
There are no recognizable risks on DEKRA’s side that theassessment procedure will not be successfully completed by
2020.
One element for the identification and assessment of risks
worldwide from accreditations, and from internal process risks
as well as for monitoring the compliance of internal basic processes is the control self-assessment. This is carried out in parallel with risk management surveys and results in a risk inventory that lists and evaluates internal process risks and market
risks.
Overall, the risk of approvals based on accreditations being
revoked is classified as low due to extensive precautionary andrisk minimization measures.

DEKRA

19

Personnel risks

In the area of personnel, there is a moderate risk in the form ofdependency on individual employees who, with their know-how,play a key role in the success of individual business segments.
This risk is minimized, among other things, by a globally-integrated talent and performance process. Attractive personnel
development programs also help retain know-how and top performers within the Group. Moderate personnel risks can also
arise if the Group fails to integrate the employees of acquired
businesses, which is why quick and systematic post-merger integration takes top priority. To continue its growth trajectory, it isalso important to win ambitious professional and qualified
young employees. This is why DEKRA invests regularly in its
employer branding, thereby further reducing the low risk of nothaving the personnel necessary for further expansion.
IT risks

For a company that operates in more than 50 countries, IT security and data protection is of utmost importance. DEKRA mitigates the medium risks associated with the reliability and security of its IT security systems by investing in a modern IT
infrastructure. DEKRA counters the risk of critical data getting
damaged or lost or getting into the hands of unauthorized third
parties by constantly monitoring and assessing IT risks as partof its internal control system, risk management and compliancemanagement.
Financial risks

Although there is a certain risk of bad debts and late payments,
it is deemed to be low. DEKRA protects itself from defaults bymeans of active customer and contract management, global key
account management and thorough creditworthiness checks. Byplanning ahead and systematically taking preventive measures,
DEKRA is also able to reduce the interest rate risk. As most of
DEKRA’s transactions are conducted in euros, the exchange raterisk is low.

Financial Report 2017

20

GROUP MANAGEMENT REPORTGROUP MANAGEMENT REPORT

Risk, Opportunities and Forecast Report

Risk, Opportunities and Forecast Report

Debt financing of the Group is primarily provided by loans
against a promissory note as well as through approved bankloans. In order to minimize the interest rate risk inherent in thefinancing of the Group, interest derivatives for floating rate loans
were used in the fiscal year. The portfolio of interest derivatives
as of the reporting date amounts to 28.5 million euros (prioryear: 28.5 million euros). The liquidity headroom required forthe operating business is secured by means of cash and cash
equivalents, as well as via approved credit lines at DEKRA SE.
The central cash pool is used to control the liquidity and supply
of both the national and increasingly also the international subsidiaries. The resulting transparency prevents possible risks.
Short-term investments of cash and cash equivalents are only
made with top-rated financial institutions and on the basis ofcurrent ratings of rating agencies as well as taking into accountcurrent CDS spreads.
Finally, DEKRA rates the risk of being unable to meet its
payment obligations arising from financial instruments as ofDecember 31, 2017 as low.
Overall assessment of the Management Board on risks to
the Group’s abilit y to continue as a going concern

The overall risk potential and average probability of occurrence
increased slightly in 2017 due to general economic and politicalconditions as well as the systematic continuation of globalization
efforts. However, the risk structure and risk distribution remain
stable. The overall risk situation is acceptable in relation to theGroup’s annual results and operating cash flow. The sum total of
the individual risks does not endanger DEKRA’s existence. There
are no identifiable risks that jeopardize the Group’s ability tocontinue as a going concern. The Management Board ensuresthe long-term existence of the Group through sustainable business management based on sound finances and a proven business model.

DEKRA

Oppor tunities repor t

Operating oppor tunities

Environment and industr y oppor tunities

Through its strategic acquisitions and globalization in recent
years, DEKRA is set for further growth. The fact that the Groupis highly diversified in terms of both geography and areas ofexpertise is expected to lead to considerable business growth,
especially abroad. This is the case for DEKRA Automotive and
DEKRA Industrial in areas such as vehicle and plant inspections.
DEKRA Personnel is also gradually tapping new foreign markets, such as in the training and education of nursing staff forGerman clinics and in employee leasing activities.

Safety is a basic necessity for people across the entire globe. This
is why demand for corresponding services is not only growing
in western industrial nations, but also in the developing andemerging economies. This applies, for example, on the road, atwork and at home: three aspects of life in which DEKRA is positioned for further growth.
Based on its wide range of services, DEKRA Automotive
does not just have further growth potential in Germany, it also
expects further mid-term growth potential primarily in growth
regions such as North America and Asia. DEKRA also expects
growth in regions such as South America, Scandinavia andcountries such as Portugal and South Africa in the coming years.
The strength of German industry, for instance in exports,
and the dynamic development in the North American and Asian
growth markets promise to boost business development in theBusiness Unit DEKRA Industrial.
Against the background of favorable economic conditionsin Germany, demand for qualified specialists and temporary
workers could continue to increase, thereby supporting the business of DEKRA Personnel.
Strategic oppor tunities

Promoting safety has been DEKRA’s mission pursuant to its articles of incorporation since its foundation in 1925. The strategicorientation towards this important socio-political concern was
strengthened further. With its “Vision 2025”, DEKRA will continue to expand its position as a global partner for safety in years
to come. This strategic and operational focus of the Group offers
considerable growth opportunities. Safety pays off – for individuals and society as a whole as well as for DEKRA’s customers andthus for the Company.

Financial Report 2017

Forecast repor t

Planning for the next two years also anticipates a slight increasein operating profit. To achieve this, DEKRA will expand its
activities in high-margin business activities, exploiting synergies
within and between its business units, and will continue to optimize its global structures and processes. Headcount is also
expected to continue to rise in line with revenue growth. By theend of 2018, the number of employees is expected to exceed thethreshold of 45,000.
Following a successful fiscal year 2017, the Management Boardof DEKRA expects the strategic alignment of the Group to create
further impetus for growth.

Stable development

The economic environment is expected to remain positive in thecurrent year. According to estimates by the International Monetary Fund (IMF), global GDP is to increase by 3.1 %. The developing and emerging economies are expected to record growthof 4.5 %, the industrial nations 2.2 %. The World Bank anticipates
the highest growth rates in individual countries India (7.3 %) andChina (6.4 %).
At the same time, economic conditions are becoming moredemanding. Geopolitical challenges are increasing: protectionist
aspirations and the resulting barriers to trade are not yet precisely foreseeable. Brexit and possible political instability withresulting economic impact also weigh on the development of the
global economy. DEKRA is not completely immune to thesedevelopments. Thanks to its good international positioning andthe strong basic human need for safety, DEKRA expects further
growth. Revenue is expected to increase by between 5 % and 8 %in the fiscal year 2018. Organic growth is expected to be higher
than external growth driven by acquisitions.

Stuttgart, March 22, 2018
DEKRA SEThe Management Board

Kölbl, Chairman

Gerdon				Klinke

Rauh

DEKRA

21

Financial Report 2017

22

C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S﻿﻿Consolidated financial statements

DEKRA SE
Consolidated statement of comprehensive
income for fiscal year 2017

CONTENTSIN THOUSAND EUR

2 3 		 C O N S O L I D A T E D S T A T E M E N T O F C O M P R E H E N S I V E I N C O M E

Revenue

Notes

2017

2016

5.1

3,134,827

2,903,645

Increase in inventories of work in process
2 4 		 C O N S O L I D A T E D S T A T E M E N T O F F I N A N C I A L P O S I T I O N
2 6 		 C O N S O L I D A T E D S T A T E M E N T O F C H A N G E S I N E Q U I T Y
2 8 		 C O N S O L I D A T E D S T A T E M E N T O F C A S H F L O W S
3 0 		 N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S

23

Own work capitalized

267

467

7,850

6,862

Other operating income

5.2

31,923

27,887

Cost of materials

5.3–307,612–301,443

Personnel expenses

5.4–2,021,636–1,832,440

Other operating expenses

5.5–554,338–535,947

Depreciation, amortization and impairment losses on property, plant andequipment and intangible assets

5.6–88,236–88,00930

1 General comments

Profit/loss from financial assets accounted for using the equity method

5.7

1,353

959

30

2 Accounting principles

30

3 Accounting policies

Interest income

5.7

6,170

5,391

45

4 Business combinations

Interest expense

5.7–23,781–30,188

46

5 Statement of comprehensive income / income statement

Other financial result

5.7

5,753

543

51

6 Statement of financial position

Financial result

5.7–10,505–23,295

67

7 Statement of cash flows

Earnings before taxes

192,540

157,727

69

8 Other disclosures in the notes

Income taxes

5.8–59,697–49,84070

9 Capital management

Net income for the year70

10 Financial management80

11 Related par t y disclosures

82

12 Disclosures on the Management Board and Super visor y Board

83

13 Subsequent events

83

14 Other disclosures

9 3 		 I N D E P E N D E N T A U D I T O R ’ S R E P O R T
9 7 		 R E P O R T B Y T H E C H A I R M A N O F T H E S U P E R V I S O R Y B O A R D

5.9

132,843

107,887

thereof attributable to owners of DEKRA SE

6.12

131,418

106,913

thereof attributable to non-controlling interests

6.13

1,425

974

Net loss/gain on
Available-for-sale assets

6.9–4,509287

Hedging instruments

6.16

492

2,043

Deferred taxes recognized in other comprehensive income

5.8

1,262

–708

Translation reserve–18,999

5,172

Items that can be recycled through profit or loss in future–21,754

6,794

Net loss/gain on
Remeasurement of defined benefit plans

6.14

5,865

–60,234

Deferred taxes recognized in other comprehensive income

5.8–1,29017,974

Items that will not be recycled through profit or loss in future

4,575–42,260

Other comprehensive income–17,179–35,466

Total comprehensive income

115,664

72,421

114,239

71,447

1,425

974

thereof attributable to
Owners of DEKRA SE
Non-controlling interests

DEKRA

Financial Report 2017

DEKRA

Financial Report 2017

24

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

﻿

﻿

25

DEKRA SE
Consolidated statement of financial
position as of December 31, 2017
ASSETS

Notes

IN THOUSAND EUR

Dec. 31, 2017

Dec. 31, 2016

Non-current assets

EQUITY AND LIABILITIES

Notes

IN THOUSAND EUR

Dec. 31, 2017

Dec. 31, 2016

EquityIntangible assets

6.1/6.2

698,493

687,911

Issued capital

6.12

25,56525,565

Property, plant and equipment

6.3

314,849

290,605

Capital reserve

6.12

550,529

520,529

Financial assets accounted for using the equity method

6.4

10,974

9,621

Revenue reserves

6.12

308,823

230,859

Other non-current financial assets

6.5

60,25488,931

Accumulated other comprehensive income

6.12–260,020–242,841

Other non-current assets

6.6

5,777

5,536

Total equity of the owner624,897534,112Deferred income tax assets

5.8

149,095

143,593

Non-controlling interests

10,562

9,395

1,239,442

1,226,197

635,459543,507

Current assets

6.13

Total equity

Liabilities

Inventories

6.7

7,529

8,521

Trade receivables

6.8

526,577

459,940

Provisions for pensions and similar obligations

6.14

492,415

629,069

Other current financial assets

6.9

173,313204,577

Other non-current provisions

6.15

18,85318,721Other current assets

6.10

29,35926,400Non-current financial liabilities

6.16

232,196

270,633

Current income tax receivables

5.8

37,51029,919Other non-current liabilities

6.18

2,945

3,535

Cash and cash equivalents

6.11

76,442

135,766

Deferred income tax liabilities

5.8

34,33440,189850,730

865,123

780,743

962,147

Non-current liabilities

Current liabilities

Total assets

2,090,172

DEKRA

Financial Report 2017

2,091,320

Other current provisions

6.15

20,90221,003

Trade payables

6.17

98,35089,540Current financial liabilities

6.16

182,868

115,738

Other current liabilities

6.18

362,485

351,187

Current income tax liabilities

5.8

9,365

8,198

673,970

585,666

Total liabilities

1,454,713

1,547,813

Total equity and liabilities

2,090,172

2,091,320

DEKRA

Financial Report 2017

26

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

﻿

﻿

27

DEKRA SE
Consolidated statement ofchanges in equity 2017
IN THOUSAND EUR

Accumulated other comprehensive income

Group equity

EquityIssued capital

Capital reserve

Revenue reserves

Translation
reserve

Available-for-saleassetsHedging instruments

Remeasurement ofdefined benefit plans

OwnersNon-controllinginterests

25,565505,529

165,957

2,677

2,891

–2,151–210,792

489,676

13,772

503,448–37,265–45–37,310

15,0000

15,0000

59

59–4,269–4,269–5–4,274

Acquisition of non-controlling interests

–477

–477

–5,360–5,837

Consolidated net income for the year

106,913

As of Dec. 31, 2015

Profit and loss transfer agreement/dividend distribution–37,265

Capital increase

15,000

Other changes
Changes to the consolidated group

Other comprehensive income for the period
Total comprehensive income
As of Dec. 31, 2016

106,913974

107,887

5,172

209

1,413

–42,260–35,466

0–35,46600106,913

5,172

209

1,413

–42,260

71,447974

72,421

25,565

520,529

230,859

7,849

3,100

–738

–253,052

534,112

9,395

543,507–53,984–536–54,52030,000921

30,921

Profit and loss transfer agreement/dividend distribution–53,984

Capital increase

30,000

Other changes

544

544

–643

–99

Changes to the consolidated group

–14

–14

0

–14

0

0

0

131,418

1,425

132,843

Acquisition of non-controlling interests
Consolidated net income for the year

131,418

Other comprehensive income for the period
Total comprehensive income
As of Dec. 31, 2017

DEKRA

Financial Report 2017–18,999–3,097342

4,575–17,1790–17,17900131,418–18,999–3,097342

4,575

114,239

1,425

115,664

25,565550,529

308,823–11,1503–396–248,477

624,897

10,562

635,459

DEKRA

Financial Report 2017

28

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

﻿

﻿

29

DEKRA SE
Consolidated statement of cash flows
for fiscal year 2017
OPER ATING ACTIVITIESFINANCING ACTIVITIES

2017

2016

Consolidated net income for the year

132,843

107,887

Cash received from equity contributions from owners

Depreciation/amortization/impairment losses/reversals of impairment losses

89,10789,041

Cash received from equity contributions from non-controlling interests

IN THOUSAND EUR

Gain/loss from the disposal of financial and intangible assets and property, plant andequipment–3,609

–1,460Interest income/expenses and dividends

6,565

11,850Current income taxes

59,697

49,840Change in non-current provisions–7,774–6,047

Contribution of funds to the Contractual Trust Arrangement (CTA)–59,000

0

Other non-cash expenses/income–17,804–2,190Change in inventories, receivables and other assets–74,972–37,426

Change in liabilities and current provisions

33,27743,467

Profit or loss from associates–1,491–959

Interest received

2,900

3,260

–56,097–48,542

Taxes received

254

3

Dividends received

408

538

104,304

209,262

Taxes paid

Cash flow from operating activities

INVESTING ACTIVITIES

2017

2016

–101,386–87,651

Financial assets and other assets–14,454–10,366

Subsidiaries and other business entities–53,620–14,897

12,2106,459

IN THOUSAND EUR

IN THOUSAND EUR

Financial assets and other assets
Cash flow from investing activities

DEKRA

Financial Report 201727,1171,850–130,133–104,605

30,00015,000921

0–29,478

0–5,837

Cash paid in relation to loans to owners–22,006–1,010Cash repayments of loans–14,434–144,873

Cash received from borrowing

19,482

119,417

Cash repayments of liabilities from finance leases

–892

–599

Interest paid

–7,151–12,755–31,881–60,135

2017

2016

Changes in cash and cash equivalents–57,71044,522

Changes in cash and cash equivalents due to exchange rates and changes
in the consolidated group–1,614

1,687

Cash and cash equivalents at the beginning of the period

135,766

89,557

Cash and cash equivalents at the end of the period

76,442

135,766

Cash paid for the acquisition of non-controlling interests

Cash flow from financing activities

C A S H A N D C A S H E Q U I VA L E N T S

IN THOUSAND EUR

Cash received from disposals ofIntangible assets and property, plant and equipment

2016–37,801

Cash paid to owners and non-controlling interests from profit transfers/dividends

Cash paid for investments in
Intangible assets and property, plant and equipment

2017

DEKRA

Financial Report 2017

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

31

Notes to the consolidated financial
statements of DEKRA SE, Stuttgart,
for fiscal year 2017
1

GENERAL COMMENTS

2

DEKRA SE has its registered office at Handwerkstrasse 15 in
Stuttgart, Germany, and is entered in the commercial register at
Stuttgart local court under HRB no. 734316.
DEKRA is an international, independent expert organization operating in the areas of Automotive, Industrial and Personnel.
The consolidated financial statements on December 31, 2017
include DEKRA SE and its consolidated subsidiaries.
The Management Board authorized the issue of the consolidated financial statements of DEKRA SE for the fiscal year
from January 1 to December 31, 2017 on March 22, 2018 andpresented them to the Supervisory Board for review andapproval.
The prior-year financial statements and management
report were filed for publication in the Bundesanzeiger [German
Federal Gazette] in the reporting year.
All shares in DEKRA SE are held by DEKRA e.V., Stuttgart. DEKRA e.V., Stuttgart, is also the ultimate parent of theCompany.

ACCOUNTING PRINCIPLESThe Company has prepared its consolidated financial statementsin accordance with the International Financial Reporting Standards (IFRS) as adopted by the EU as of the reporting date.
The principles of the Framework and the IFRS of the International Accounting Standards Board (IASB) as well as the interpretations of the IFRS Interpretations Committee (formerly:
IFRIC) effective as of the reporting date were applied.
Information on the adoption of specific IFRS is provided
in the comments on the individual items of the statement offinancial position later on in these notes.
The consolidated financial statements are presented ineuros. Unless otherwise stated, all amounts have been roundedup or down to the nearest thousand euros in accordance withcustomary commercial practice.
The consolidated financial statements comply with therequirements of Sec. 315e (3) HGB [“Handelsgesetzbuch”: German Commercial Code].
3

S TA N DA R D/ I N T E R P R E TAT I O N;
­E F F E C T I V E D A T E

IMPAC T O N T H E CO NSO L I DAT E D FI N A N C I A L S TAT EME N T S
OF DEKRA SE

The following IFRS standards and interpretations were subject to mandatory application
for the first time in the fiscal year:

Amendments to IAS 7
Statement of Cash Flows;
January 1, 2017

The amendments to IAS 7 related to extended disclosures in the notes for liabilities resulting from the financing activities of an entity. A statement of reconciliation was used toapply the amendments. See note 7 in this regard.

Amendments to IAS 12
Income Taxes;
January 1, 2017

Clarification that unrealized losses from debt instruments measured at fair value lead toa deductible temporary difference if the taxable value of the debt instrument corresponds
to its cost. Furthermore, the amendments provide general guidance on how an entity
should determine future taxable profits and explain the circumstances in which taxable
profit may include the recovery of some assets for more than their carrying amount. The
rules for the treatment of unrealized losses from debt instruments are already applied in
the DEKRA Group. As a result, there is no effect on the consolidated financial statements.

Annual Improvements to IFRSs(2014–2016 Cycle);
January 1, 2017

The Annual Improvements to IFRSs 2014–2016 Cycle relate to an omnibus of standards.
The resulting amendments applicable from January 1, 2017 relate to IFRS 12 Disclosuresof Interests in Other Entities. IFRS 12 clarifies that the disclosures pursuant to IFRS 12 also
apply for any interests in subsidiaries, joint ventures or associates that are classified asheld for sale in accordance with IFRS 5, with an exception for the disclosures pursuant to
IFRS 12.B10-B16 (financial information). The amendment does not have any effect on the
consolidated financial statements.

ACCOUNTING POLICIESThe accounting policies adopted are consistent with those of theprevious reporting period. In addition, the new or revised standards that were subject to mandatory adoption for the first timein the fiscal year 2017 in accordance with the respective transitional provisions are presented below.

DEKRA

Financial Report 2017

DEKRA

Financial Report 2017

32

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

The IASB and the IFRS IC have issued the standards, interpretations and amendments listed below that were not yet mandatory asof December 31, 2017. There are no plans to early adopt these new pronouncements.
S TA N DA R D/ I N T E R P R E TAT I O N;
EFFECTIVE DATEADOP TED BY THE
EU COMMISSIONA N T I C I PAT E D IMPAC T O N T H E CO NSO L I DAT E D FI N A N C I A L
STATEMENTS OF DEKR A SEIFRS 4
Insurance Contracts;
January 1, 2018

Yes

None

IFRS 15
Revenue from Contracts with
Customers (Clarifications);
January 1, 2018

Yes

See explanations for
IFRS 15 Revenue from Contracts with Customers.

IAS 19
Employee Benefits;
January 1, 2019No

Currently being assessed

IAS 28Investments in Associates andJoint Ventures;
January 1, 2019No

Currently being assessed

IAS 40Investment Property;
January 1, 2018

No

IFRS 2
Share-based Payment;
January 1, 2018

Yes

None

IFRS 9Prepayment Features with Negative
Compensation;
January 1, 2019

No

None

Improvements to IFRSs (2014–2016 Cycle);
January 1, 2018

Yes

None

Improvements to IFRSs (2015–2017 Cycle);
January 1, 2019

No

None

IFRIC Interpretation 22
Foreign Currency Transactions andAdvance Consideration;
January 1, 2018

No

Immaterial

IFRIC Interpretation 23
Uncertainty over Income
Tax Treatments;
January 1, 2019

No

Immaterial

Amended standards and interpretations

S TA N DA R D/ I N T E R P R E TAT I O N;
­E F F E C T I V E D A T E

33

ADOP TED BY THE
EU COMMISSIONA N T I C I PAT E D IMPAC T O N T H E CO NSO L I DAT E D FI N A N C I A L­S T A T E M E N T S O F D E K R A S E

YesIn July 2014, the IASB published IFRS 9, which is to replace
IAS 39. IFRS 9 is mandatory for fiscal years beginning on or afterJanuary 1, 2018.

New standards

IFRS 9Financial Instruments;
January 1, 2018

The standard relates in part to the classification and measurement offinancial instruments using the contractually agreed cash flows andthe business model. The standard also implements a new impairment
model and introduces revised accounting for hedges.
DEKRA analyzed the financial assets and liabilities across the Groupand expects the following effects from the application of IFRS 9.
Financial instruments classified as ”Loans issued and receivables/
financial liabilities measured at amortized cost” pursuant to IAS 39
are also recognized at “Amortized cost” under IFRS 9. There is nochange in the accounting treatment for these financial instruments.
For financial liabilities since measured “at fair value through profit
or loss”, under the new rules the fair value option will be used.
Changes in fair value will thus be recognized in profit or loss, as was
the case in the past.

None

The majority of debt instruments currently held that are allocated tothe category “Available-for-sale assets at fair value not through profit
or loss” under IAS 39 must be recognized “at fair value through profit
or loss” according to IFRS 9. This means that fair value changes mustin future be recognized through profit or loss and no longer in othercomprehensive income.
By contrast, equity instruments in this category will in future be likewise recognized “at fair value not through profit or loss”. Fluctuations
in fair value will be recognized in other comprehensive income.
Based on the new rules on impairment using the expected credit loss
model, expected losses will in some cases in future be expensed
sooner than under the incurred loss model existing under IAS 39. To
calculate risk provisions, a distinction is now made between different
levels of risk provisioning. The allocation takes place by analyzing
the probability of default and the further development since initialrecognition. At a minimum, the “12-month expected loss” is recognized for risk provisioning (level 1). If the credit default risk of thefinancial instrument has increased significantly since initial recognition, a risk provision is recognized for the “lifetime expected loss”(level 2 and 3). For trade receivables and contract assets pursuant
to IFRS 15, the simplified approach is used in the DEKRA Group.
Financial guarantee contracts are also included in the scope of the
expected credit loss model although they fall under the scope of
IAS 37. The expected impairment loss must be recognized as a provision.

DEKRA

Financial Report 2017

DEKRA

Financial Report 2017

34

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

35

S TA N DA R D/ I N T E R P R E TAT I O N;
­E F F E C T I V E D A T E

ADOP TED BY THE
EU COMMISSIONA N T I C I PAT E D IMPAC T O N T H E CO NSO L I DAT E D FI N A N C I A L­S T A T E M E N T S O F D E K R A S E

S TA N DA R D/ I N T E R P R E TAT I O N;
­E F F E C T I V E D A T E

ADOP TED BY THE
EU COMMISSIONA N T I C I PAT E D IMPAC T O N T H E CO NSO L I DAT E D FI N A N C I A L­S T A T E M E N T S O F D E K R A S E

IFRS 9Financial Instruments;
January 1, 2018

Yes

DEKRA is applying IFRS 9 for the first time as of January 1, 2018 andwill exercise the option not to restate comparative figures for 2017.
Any differences between the previous carrying amount and the carrying amount at the beginning of the fiscal year are recognized in
the profit carryforward. The estimated overall effect is expected to
be in the mid double-digit millions.

IFRS 15
Revenue from Contracts with Customers;
January 1, 2018

Yes

IFRS 15 was issued by the IASB in May 2014. It replaces existing
guidelines on recognizing revenue, including IAS 18 Revenue Recognition, IAS 11 Construction Contracts and IFRIC 13 Customer Loyalty
Programmes. The objective of IFRS 15 is to establish principles thatprovide users of financial statements with useful information on revenue and cash flows arising from a contract with a customer. IFRS 15
is mandatory for fiscal years beginning on or after January 1, 2018.
The standard provides a uniform principles-based five-step model for
calculating and recognizing revenue that must be applied to all contracts with customers. The standard also contains a number of otherrules on details and expands the required disclosures in the notes.
DEKRA is currently finalizing the group-wide analysis of contracts interms of their accounting in accordance with IFRS 15. The analysis of
cash flows was carried out for all major business models of the subsidiaries. The analysis resulted in the following findings:– S pecifying the principal/agent relationship using the principle ofcontrol does not lead to any material change.
– T he vast majority of contracts currently accounted for according to
the percentage of completion method meet the requirements forrecognizing revenue over time.
– L ater recognition of revenue in the case of granting variable consideration does not lead to any material effect in terms of the timing of revenue recognition.
– T he effect on total assets and the statement of comprehensive income
from capitalizing the expenses for contract acquisition and fulfillment is classified as immaterial.
– T he contracts in the DEKRA Group do not contain any significant
financing components that would have to be considered in the transaction price.
– D epending on the customer contract, contract liabilities must be
netted with contract assets. This corresponds more or less to current practice and does not lead to any material effect on total assets.
Based on this current assessment by management, DEKRA does notexpect any significant effect on the Group’s financial position andperformance.
DEKRA will apply the modified retrospective method as a transitional
method as of January 1, 2018. Contracts not yet completed as of thatdate will be recognized as if they had been presented in accordancewith IFRS 15 from the beginning. The cumulative effect from first-time
application will be recognized in the revenue reserves. DEKRA does
not expect any material effect from transition.

DEKRA

Financial Report 2017

DEKRA

Financial Report 2017

36

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

S TA N DA R D/ I N T E R P R E TAT I O N;
­E F F E C T I V E D A T E

ADOP TED BY THE
EU COMMISSIONA N T I C I PAT E D IMPAC T O N T H E CO NSO L I DAT E D FI N A N C I A L­S T A T E M E N T S O F D E K R A S E

IFRS 16
Leases;January 1, 2019

Yes

IFRS 16 will primarily affect lease accounting for lessees and lead to
all leases being recognized in the statement of financial position. The
distinction between finance and operating leases required to date
will no longer apply with respect to the lessee. A right of use to theunderlying asset must be recognized that corresponds to the present
value of future lease payments plus directly attributable costs. The
lessee must also recognize a financial liability for the obligation for
future lease payments. There is an optional exemption for short-termleases and for leases with an underlying asset of low value.
DEKRA expects these new developments to have material effect on
the presentation of its financial position and performance. The newrules relate in particular to the following:– Payment obligations from leases must in future be recognized asrights of use and lease liabilities, regardless of whether the leaseis an operating lease or a finance lease. DEKRA expects a significant increase in total assets and total equity and liabilities as of thedate of first-time application on account of the rise in lease liabilities and fixed assets.
– I n the future, write-downs and interest expenses will be recognizedin the income statement instead of lease expenses. This leads to asignificant improvement in the EBITDA and an increase in the cash
flow from operating activities in the statement of cash flows.
The overall effects are being analyzed as part of a group-wide project. It is not yet possible to make a reliable estimate due to the large
number of contracts.

IFRS 17
Insurance Contracts;
January 1, 2021

No

None

DEKRA

Financial Report 2017

3.1 Principles of consolidation

All companies over which the Group’s ultimate parent exercises
direct or indirect control are included in full in the consolidated
financial statements. Control is assumed as soon as the parent
company has decision-making power over the subsidiary due tovoting or other rights, is exposed to, or has rights to, variable
returns from the subsidiary and has the ability to affect those
returns through its power over the investee. First-time consolidation is carried out as of the date on which DEKRA SE obtains
control of the subsidiary. The subsidiary is removed from theconsolidated group as soon as control ends.
During the reporting period and as of the reporting date,there were no joint ventures or joint operations which would
have had to be consolidated using the equity method or with
their pro rata assets and liabilities as well as income andexpenses.
Associates are accounted for using the equity method. An
associate is an entity over which the owner exercises significant
influence, but that is neither a subsidiary nor a joint venture orjoint operation. In the consolidated financial statements of
DEKRA SE, a total of two German (prior year: two) companies
were consolidated using the equity method. These companies
were capitalized at cost. Subsequently, the carrying amounts ofthe equity investments are increased or reduced each year by the
proportionate share of profit or loss, dividends distributed orother changes in equity. The principles of purchase price allocation for full consolidation apply in the same way to the initial
measurement of investments. Goodwill relating to the associate
is included in the carrying amount of the investment and is notamortized. As of each reporting date, DEKRA tests whether the
carrying amount is impaired pursuant to IAS 36.
Subsidiaries, joint ventures, joint operations and associates
that, on account of their low level of business activity, are immaterial for the Group and the presentation of a true and fair viewof the financial position and performance, are generally includedin the consolidated financial statements at amortized cost.
Non-controlling interests in the total comprehensive
income and equity of subsidiaries are presented separately underequity in the statement of comprehensive income. On acquisitionof control, non-controlling interests are generally recognized attheir proportionate share of the identifiable net assets measured
at fair value.
The consolidated group included DEKRA SE and theother entities listed in “Other Disclosures” accordingly as ofDecember 31, 2017. The financial statements of the individual
DEKRA

37

subsidiaries are included in the consolidated financial statements as of December 31, 2017 using the uniform accounting
policies stipulated by DEKRA SE. In addition to DEKRA SE,
Stuttgart, a total of 25 German (prior year: 25) and 123 foreign(prior year: 136) entities are included.
Effects of first-time inclusion of previously immaterial subsidiaries and associates are recognized in the statement ofchanges in equity under changes to the consolidated group.
Business combinations are accounted for using the acquisition method on the basis of carrying amounts as of the date oftransfer of control (IFRS 3). Where there are non-controllinginterests, a proportionate share of goodwill in accordance withIFRS 3 (purchased goodwill method) has always been recorded
to date.
The opening IFRS statement of financial position as of January 1, 2008 adopted the carrying amounts of the goodwill recognized as of December 31, 2007 in accordance with previous
GAAP, the German Commercial Code (HGB). No remeasurement was made.
In the course of business combinations, sometimes
arrangements are made concerning contingent consideration,and call and put options are sometimes agreed with non-controlling interests with respect to those interests. These obligations are included in the purchase price calculation at their estimated fair value. On the equity and liabilities side, a financial
liability is recognized pursuant to IAS 32. Changes in fair value
in subsequent periods are recognized with an effect on profit orloss. In the case of call and put options, the acquiree is includedin the consolidated financial statements in full and no non-controlling interests are presented.
Transactions between the consolidated entities are netted.
Profits from intercompany transactions are eliminated. Effectsof consolidation on income taxes are accounted for by recognizing deferred taxes.

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Notes

Notes

Currency translation

The consolidated financial statements of DEKRA SE are presented in euros. The concept of a functional currency is applied
when translating financial statements of consolidated entities
prepared in foreign currencies. The functional currency is generally the local currency of the respective subsidiary. Assets andliabilities are translated at the closing rate, expenses and income
at the annual average rate. The items within equity are carriedat historical rates. The resulting difference is recognized directlyin equity and presented separately in the statement of comprehensive income.

In the separate financial statements of the subsidiaries, business
transactions in foreign currencies are translated using theexchange rate on the date of the transaction. In subsequent periods, monetary assets and liabilities in foreign currencies aretranslated at the exchange rate as of the reporting date. Translation differences are generally recorded in the statement of comprehensive income under “Other operating income” or “Other
operating expenses”. In the case of financial receivables and liabilities, exchange rate effects are disclosed in the financial result.
Non-monetary assets and liabilities are not generally remeasured
in subsequent periods.

The following table shows the exchange rates of material entities listed in foreign currencies:
RATE AS OF REPORTING DATE

1 EURO =ANNUAL AVERAGE RATE

Dec. 31, 2017

Dec. 31, 2016

2017

2016

Brazilian real (BRL)

3.97293.43053.6041

3.8616

Czech koruna (CZK)

25.5350

27.021026.3272

27.0343

Chinese renminbi (CNY)7.80447.32027.62647.3496

Danish krone (DKK)

7.44497.43447.43877.4454

British pound sterling (GBP)

0.88720.85620.87610.8189Croatian kuna (HRK)

7.44007.55977.46447.5345

Hungarian forint (HUF)

310.3300

309.8300

309.2725

311.4600

Moroccan dirham (MAD)11.2239

10.6705

10.9439

10.8721

New Zealand dollar (NZD)

1.68501.51581.5895

1.5895Hong Kong dollar (HKD)

9.37208.17518.80128.5900Polish zloty (PLN)

4.17704.41034.25634.3636

Swedish krona (SEK)9.84389.55259.63699.4673US dollar (USD)

1.1993

1.05411.1293

1.1066South African rand (ZAR)

14.8054

14.457015.0434

16.2772

Taiwan dollar (TWD)

35.750234.062234.375235.7138

Swiss franc (CHF)

1.1702

1.07391.11161.0902

Turkish lira (TRL)

4.54643.70724.12143.3428

Indian rupee (INR)

76.6055

71.5935

73.4980

74.3553

DEKRA

Financial Report 201739

3.2 Significant accounting policies

Proper t y, plant and equipment

The financial statements have been prepared on a cost basis,
except for financial instruments in the available-for-sale andat fair value through profit or loss categories, as well as derivative financial instruments, obligations from options and conditional purchase price elements.

Pursuant to IAS 16, property, plant and equipment are recognized at cost less accumulated depreciation and accumulated
impairment losses. If there are indications of impairment andthe recoverable amount is below the cost less any accumulated
depreciation and impairment losses, then an impairment loss isrecognized.
Costs of conversion include direct materials and laborcosts as well as production overheads. Subsequent costs are capitalized when it is probable that future economic benefits, inexcess of the originally assessed standard of performance of theasset, will flow to the Company. All other subsequent expenditure is recognized directly as an expense. Maintenance expenses
are recognized through profit or loss in the statement of comprehensive income.
Property, plant and equipment are depreciated on astraight-line basis over the economic useful lives of the individual components. The useful lives of buildings and their individual components are between ten and 50 years, plant and machinery between ten and 25 years, and furniture and fixtures between
three and 20 years. There were no significant residual values
within the meaning of IAS 16.53 to be taken into account in thecalculation of the depreciation charge.
Leased assets for which both the economic risk and theeconomic benefit lie with DEKRA (finance lease) are recognizedin the statement of financial position pursuant to IAS 17 anddepreciation expense and impairment losses are charged. The
useful lives are measured using the shorter lease term or the economic useful life. The payment obligation is recognized at thefair value of the asset or the lower present value of all future lease
payments. Interest expenses are recognized through profit orloss in the statement of comprehensive income.
Lease payments for operating leases are recognizedthrough profit or loss on a straight-line basis over the lease term.

Goodwill

The amount by which the purchase price of a business combination exceeds the fair value of the individually identifiableacquired net assets is recognized as goodwill. Incidental acquisition costs are recognized in profit of loss.
Under IAS 38, goodwill from acquisition accounting is notamortized over a useful life. Where necessary, impairment losses
are recognized in accordance with IAS 36 (impairment only
approach).
Intangible assets

Acquired intangible assets are recognized at cost less any accumulated amortization. The useful lives of all intangible assets areclassified as finite and are generally between three and eight
years. Useful lives of trademarks or customer relationships of ten
to 15 years are used for purchase price allocations. Intangible
assets are amortized using the straight-line method. Where necessary, impairment losses are recognized, and then reversed if
the reasons for the impairment cease to apply at a later date.
Internally generated intangible assets such as software arestated at cost if they meet the recognition criteria under IAS 38.
Cost includes directly and indirectly allocable costs. Researchcosts are treated as period expenses and were immaterial in thepast fiscal year. Borrowing costs are capitalized if they relate toa qualifying asset.

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Notes

Notes

Gains and losses from the disposal of non-current assets
are determined as the difference between the net disposal proceeds and the carrying amount of the asset and recognized in
the statement of comprehensive income under other operating
income or other operating expenses.
Pursuant to the revised IAS 23, borrowing costs are capitalized only if they are incurred for the financing of the acquisition, construction or production of a qualifying asset. A qualifying asset is an asset that necessarily takes a substantial periodof time to get ready for its intended use or sale.
Inventories

Inventories are measured at the lower of cost or net realizablevalue pursuant to IAS 2. Cost is calculated according to theweighted average cost method. Net realizable value is the estimated selling price in the ordinary course of business less theestimated costs of completion and the estimated costs necessary
to make the sale that have yet to be incurred.
Financial assets and financial liabilities

A financial instrument is a contract that gives rise to a financial
asset of one entity and a financial liability or equity instrumentof another entity.
Financial assets are contractual rights to receive cash orother financial assets from another entity or to exchange financial assets or liabilities with another entity at potentially favorable terms. They primarily consist of trade receivables, securities
and shares in subsidiaries, which are included at amortized costin the consolidated financial statements for reasons of materiality. Moreover, loans to non-consolidated subsidiaries and investees are included. At DEKRA, the financial instruments arereported on the settlement date.

DEKRA

Financial liabilities comprise contractual obligations to deliver
cash or other financial assets to another entity or to exchange
financial assets or obligations with another entity at potentially
unfavorable terms. These primarily include liabilities to banks
and trade payables as well as other financial liabilities.
Pursuant to IAS 39, financial assets are allocated using thefollowing categories:
Financial assets at fair value through profit or loss

This category includes assets that must be measured at fairvalue through profit or loss (trading book) and assets thatcan be optionally assigned to this category. The tradingbook comprises assets that are held for speculative purposes or are part of a trading portfolio. Derivatives are
assigned to the trading book, unless they are recognizedas part of an effective hedge. Other financial assets can also
be assigned to this category under certain circumstances.
The assets are initially recognized at cost. Transaction costs are recognized through profit or loss. Subsequent measurement is at fair value. This corresponds to theamount that could be recovered if the asset were tradedunder current market conditions. If the financial asset istraded on an active market, this generally means the market price. Changes in value in this category are recognizedthrough profit or loss.
The DEKRA Group only classifies derivatives in thiscategory that do not constitute a hedging relationship.

Financial Report 201741

Loans issued and receivables measured at amortized cost

Financial liabilities at fair value through profit or loss

Loans and receivables are non-derivative financial assets
with fixed or determinable payments that are not quoted
on an active market.
They are initially recognized at cost plus directly
attributable transaction costs. Subsequent measurement is
at amortized cost using the effective interest method. Valuation allowances, for example due to the counterparty’s
inability to pay, are recognized through profit or loss.
The DEKRA Group uses this category for some of its
financial assets.

Derivatives with negative fair values must be assigned tothis category, unless they are recognized as part of aneffective hedge. All liabilities held for speculative purposesalso belong to this category. Other liabilities can optionallybe assigned to this category, in the same way as “Financial
assets at fair value through profit or loss”.
Measurement is the same as for “Financial assets atfair value through profit or loss”.
The DEKRA Group only uses this category for derivatives that do not constitute a hedging relationship as well
as for liabilities from business combinations.

Held-to-maturity investments

The requirement for classification in this category is theCompany’s intention or ability to hold the financial instrument until maturity. In addition, the assets must have fixed
or determinable payments, and fixed terms, and be quoted
on an active market.
They are initially recognized at cost plus transaction
costs. Subsequent recognition is at amortized cost. Permanent impairment losses are recognized through profit or loss.
The DEKRA Group does not use this category.

Financial liabilities measured at amortized cost

All other financial liabilities are measured at amortizedcost using the effective interest rate method and assigned
to this category. Participation capital was measured using
the effective interest rate method due to the secured interest payments.
The DEKRA Group uses this category for most of its
financial liabilities.
Derivative financial instruments and hedge accounting

Available-for-sale assets at fair value not through profit or loss

Financial instruments that cannot be allocated to the othercategories are classified as available-for-sale.
They are initially recognized at cost plus transaction
costs. Subsequent measurement is at fair value. Changes invalue are recognized in the statement of comprehensive
income until the item is disposed of. If there is objective
evidence of permanent or significant impairment, i.e., adecrease in the fair values of more than nine months or
20 % lower than cost, the impairment loss is recognizedthrough profit or loss. In addition to duration and extent
of the decline in value, all information available, such as
market conditions, market prices and asset-specific factors
are taken into account.
The DEKRA Group uses this category for some of its
financial assets.

DEKRA

The DEKRA Group mainly uses derivative financial instruments in the form of cash flow hedges. These serve to control andsecure future cash flows. Derivative financial instruments are recognized at fair value in the statement of financial position andreported under financial assets or under financial liabilities. The
fair values are calculated on the basis of corresponding market
prices or using appropriate valuation techniques.
The effective portion of the change in the fair value is recognized in other comprehensive income, taking into account therelated tax effect. The ineffective part is recognized throughprofit or loss. When the hedged transaction occurs, the cumulative “other income” is reclassified through profit or loss. For
further information, we refer to the comments on financial management “Financial instruments and hedging activities”.

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Notes

Notes

43

Trade receivables and other financial assets

Deferred taxes and income taxes

Impairment losses and reversals of impairment losses

Pensions and other post- employment benefits

Trade receivables and other financial assets are recognized atnominal value. Non-current non-interest bearing receivables arestated at present value using a matching interest rate.
Credit risks are accounted for using adequate specific bad
debt allowances. Impairment losses on trade receivables areposted via a separate allowance account. If a bad debt is identified, based on the fact that a receivable has become uncollectiblefor instance, the corresponding amount is directly deductedfrom the receivable. An impairment of the other financial assets
leads to a direct reduction of the carrying amount. Impairment
losses are estimated taking into account payment histories, age
structure, a substantial deterioration in the borrower’s creditworthiness and the probability of insolvency of a debtor.
Trade receivables also include receivables from service
contracts not yet billed. In accordance with IAS 18.20 et seq.,
they are recognized using the percentage-of-completion method.
The stage of completion of each service contract is calculatedusing the cost-to-cost method as the ratio of costs incurred tothe estimated total costs. If the outcome of a service contract
cannot be reliably determined, revenue is only recognized to theextent of the contract costs incurred. Payments received for
unbilled service contracts are disclosed net of receivables frompercentage of completion on an order-by-order basis.

Income taxes include expenses and income from current anddeferred taxes as well as tax allocations to the parent DEKRA e.V.,
Stuttgart, with which the Company forms a tax group for income
tax purposes.
Current income tax liabilities/income tax assets are measured at the amount expected to be paid to/recovered from thetax authorities. The calculation is based on the tax rates enacted
or substantively enacted as of the reporting date.
Deferred taxes are recognized in accordance with the liability method pursuant to IAS 12 for temporary differences
between the tax accounts and the consolidated financial statements – with the exception of goodwill resulting from acquisition accounting that cannot be recognized for tax purposes –and for unused tax losses. Deferred tax assets are only considered
to the extent that it is sufficiently probable that they will be realized. Probable usability is based on a multi-year plan for therespective entity. Deferred taxes are calculated using the respective local tax rates on the basis of the tax rates that are expected
to apply for the period of reversal of the difference. Changes totax rates adopted by the reporting date are taken into accountwhen calculating deferred taxes.
Deferred taxes are recorded as tax income or expense
through profit or loss unless they relate to items recorded inother comprehensive income; in this case, the deferred taxes arealso recorded in other comprehensive income.
Deferred tax assets for unused tax losses are only recognized to the extent that it is probable that future taxable profit
will be available against which they can be utilized.
Deferred tax assets and liabilities are disclosed net in the
consolidated statement of financial position, if there is a legally
enforceable right to offset current tax liabilities and the deferredtaxes relate to the same taxable entity and the same taxation
authority. Accordingly, offsetting is carried out at entity and tax
group level.

The carrying amounts of the assets that fall under the scope of
IAS 36 are tested on each reporting date for indications that an
asset may be impaired. If such indications are found to exist, therecoverable amount of the asset concerned is estimated. The
recoverable amount is the higher of an asset’s net realizable value
and its value in use (present value of future cash flows). If therecoverable amount is lower than its carrying amount, an
impairment loss must be recognized to reduce the carrying
amount to the recoverable amount. Impairment losses recognized in prior years must be reversed when there is a change inestimate and the recoverable amount is higher than the carrying
amount.
In addition, annual impairment tests must be carried out
for goodwill, intangible assets with indefinite useful lives andintangible assets that are not yet available for use. As goodwill
and other intangible assets cannot generally be sold independently and cannot generate cash flows independently of otherassets, impairment tests can only be carried out in connection
with a cash-generating unit.
The cash-generating units relevant for the goodwill
impairment tests are defined at business unit level. The Business
Units Automotive, Industrial and Personnel were identified as
the smallest cash-generating units. This is due to single management, shared customer service and uniform product policy, ajoint advertising strategy, as well as joint management and monitoring of the respective units.
In the course of the impairment test of a cash-generating
unit, the carrying amount of a cash-generating unit is comparedto the recoverable amount. The cash-generating unit includes
those assets that can be allocated directly or indirectly on a reasonable and consistent basis to the cash-generating unit and will
generate the future cash inflows. If the net sales proceeds andthe present value of the cash flows of a cash-generating unit arelower than its carrying amount, the impairment expense recognized through profit or loss is allocated to the individual assetsof the cash-generating unit. This allocation is made in proportion to the individual assets’ share in the cash-generating unit’s
carrying amount. If goodwill is assigned to the cash-generating
unit, any identified impairment expense is first assigned to goodwill and then allocated proportionately to the other assets of the
cash-generating unit.

Provisions for pensions and similar obligations are calculated
according to the projected unit credit method prescribed by
IAS 19. In addition to biometric bases of calculation, this method
primarily takes into account current assumptions regarding
future increases in salaries and pensions as well as the relevant
long-term capital market interest rate, which is determined on
the basis of the market yields of high-quality fixed interest corporate bonds as of the reporting date. The provision is recognized at an amount equivalent to the defined benefit obligation.
Plan assets that are invested in order to cover defined benefit pension plans and other similar benefits are measured at fairvalue and offset against the corresponding obligations.
The return on plan assets and the interest charged on thedefined benefit obligation use the same interest rate. It is presented net in the financial result.
Actuarial gains and losses, which primarily result fromdeviations from the assumptions made, are recorded in othercomprehensive income in the period in which they occur. Past
service cost from plan amendments is immediately recognizedin personnel expenses in the fiscal year in which the amendments
are made.
Actuarial reports are obtained for the calculation of thepension provisions.

Cash and cash equivalents

Cash and cash equivalents are recognized at nominal value andcomprise cash on hand, bank balances and short-term deposits.

DEKRA

Financial Report 2017

DEKRA

Other provisions

Provisions are recognized in the amount required, based on abest estimate, to cover all present obligations as of the reporting
date. Future events which may have an effect on the amountneeded to satisfy the obligation are considered in the provisions,provided that they can be forecast with an adequately objective
degree of certainty and that the obligation results from past
events. In addition, provisions for potential losses for onerous
contracts are recognized in accordance with IAS 37.
The provision is measured at the most probable amount ofa range of expected values. Where possible, it is determined andmeasured using contractual agreements; otherwise calculations
are based on past experience and estimates by the Management
Board.
Non-current provisions are recognized at present value
and discounted at market interest rates that match the risk andthe period to realization.

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Notes

Notes

Revenue recognition

Accounting judgments and estimates

Revenue mainly consists of income from services and is recognized through profit or loss when the services have been rendered. Services are recognized according to their percentage ofcompletion, if the requirements pursuant to IAS 18.20 et seq. aremet. This mainly relates to services in the service lines Material
Testing & Inspection, Product Testing & Certification, Industry& Construction as well as Claims Services. The percentage ofcompletion is determined in accordance with the cost-to-cost
method. The contract costs incurred as of the reporting date arecompared to the expected total contract costs. Contract costs arerecognized as expenses in the period in which they are incurred.
If it is foreseeable that total contract costs will exceed total revenue, the expected loss is recognized as an expense immediately.
Dividends are recognized when the right to receive payment arises.
For all financial assets and liabilities recognized at amortized cost, interest is recognized in accordance with the effective
interest method.

In applying the accounting policies, the Management Board has
made the following judgments which have a significant effect on
the amounts recognized in the consolidated financial statements.
The consolidated financial statements include assumptions
and estimates which have an effect on the carrying amounts andrecognition of assets and liabilities as well as income andexpenses. Actual amounts may differ from the amounts basedon these estimates and assumptions.
In particular, assumptions and estimates were made concerning the useful lives of non-current assets, the recoverabilityof goodwill and other intangible assets, the recoverability ofreceivables, the adequate valuation of securities, the parameters
for measuring pension and other provisions, and the recoverability of deferred tax assets. In addition, we refer to the above
explanations and to the comments in note 6 on the individual
items in the statement of financial position.
The Group tests goodwill for impairment at least once ayear. The impairment tests carried out are mainly based on estimates. Various scenarios were therefore worked out for the individual cash-generating units. The main estimates were the future
net cash flows, based on market developments, as well as assumptions about economic development and an estimate of increases
in personnel costs, the growth rates and the weighted average
cost of capital. Even if the estimates should change, the recoverable amount is currently expected to exceed the carrying amountof goodwill. Especially with regard to the assumptions concerning goodwill impairment or on the expected future cash flows
and weighted average of cost of capital, we refer to note 6.2.
The obligation from defined benefit pension obligations
and the pension benefit payments of the subsequent year are
determined based on actuarial parameters such as interest rate,
future salary and pension increases, and age. Changes in parameters can have a significant effect on the benefit obligation. For
further explanations, we refer to note 6.14.
In some business combinations, contingent consideration
has been arranged or call or put options for non-controllinginterests have been agreed with the seller. The resulting purchaseprice liabilities are subject to estimates as to whether future targets can be achieved and in terms of assumptions regarding theGovernment grants

In accordance with IAS 20, government grants are only recognized where there is reasonable assurance that all attaching conditions will be complied with and the grant will be received.
They are recognized through profit or loss as of the date the subsidized expenses are incurred, unless they relate to subsidies foran asset. Government grants are disclosed without offsetting
under other operating income.

DEKRA

Financial Report 2017present value of future purchase price payments. For further
explanations, we refer to note 3.1.
Deferred tax assets are recognized to the extent that they arelikely to be used. The probability of their being used in future isassessed taking into account various factors such as future taxable profit in the planning periods. DEKRA uses a planninghorizon of three years. The actual amounts may differ from theestimates. These are then adjusted in other comprehensive
income or through profit or loss, depending on how they were
initially recognized.
4

BUSINESS COMBINATIONS

Presentation of significant business combinations in the fis cal year

Effective July 31, 2017, 100 % of the shares in Master Test, SGPS,
S.A., Lisbon, Portugal, and its subsidiaries were acquired for apurchase price of 20.6 million euros.
The acquired net assets amounted to –8.4 million euros.
As of the date of acquisition, the carrying amounts of theacquired assets and liabilities totaled 4.6 million euros and13.0 million euros respectively.
An amount of 2.1 million euros in assets relates to cash,
while an amount of 2.0 million euros relates to property, plant andequipment; 0.5 million euros relates to trade receivables and otherassets. The carrying amount of the receivables corresponds to theirfair value. The liabilities were repaid as part of the acquisition.
In the course of the purchase price allocation, intangible
assets (customer list and brand) totaling 7.6 million euros anddeferred tax liabilities of 1.6 million euros were recognized.
The resulting goodwill on the acquisition date amounted to23.0 million euros. In addition to synergy effects in the service
line, the goodwill arising includes intangible assets that cannot bemeasured separately from goodwill such as the permanent
workforce and know-how. Under local law, goodwill is not tax
deductible.
The main purpose of the transaction is to expand the service portfolio of the Vehicle Inspection service unit. Accordingly, the entity was allocated to the Business Unit DEKRA
Automotive.

DEKRA

45

The purchase price for this business combination was paid in
cash. The directly allocable incidental costs of 0.1 million euros
incurred in the transaction were recognized in other operating
expenses.
In addition, 100 % of the shares in VEIKI-VNL Villamos
Nagylaboratόriumok Korlátolt Felelősségü Társaság, Budapest,
Hungary, were acquired with effect as of March 31, 2017. The
purchase price amounted to 5.3 million euros.
The acquired net assets amounted to 0.6 million euros. Asof the date of acquisition, the carrying amounts of the acquired
assets and liabilities totaled 2.2 million euros and 1.6 million euros respectively.
An amount of 1.4 million euros in assets relates to property, plant and equipment, while an amount of 0.7 million euros
relates to trade receivables and other assets and 0.1 million euros
to cash. The carrying amount of the receivables corresponds totheir fair value. All liabilities are current.
In the course of the purchase price allocation, intangible
assets (customer list) totaling 2.1 million euros and deferred tax
liabilities of 0.2 million euros were recognized. The resulting
goodwill on the acquisition date amounted to 2.8 million euros.
In addition to synergy effects within the service unit, the goodwill arising includes intangible assets that cannot be measured
separately from goodwill such as the permanent workforce andknow-how. Under local law, goodwill is not tax deductible.
The main purpose of the transaction was to expand theservice portfolio of the Material Testing & Certification service
unit. Accordingly, the entities were allocated to the Business
Unit DEKRA Industrial.
The purchase price was paid in cash. The directly allocableincidental costs of 0.2 million euros incurred in the transaction
were recognized in other operating expenses.
The entities acquired during the fiscal year are included in
the consolidated financial statements with revenue of 6.6 million euros and operating profit before taxes taking into consideration amortization in the course of the purchase price allocation of 0.7 million euros. Taking into account the inclusion for
the entire year, the entities would have contributed 12.2 million euros to group revenue and 2.1 million euros to the Group’s
earnings before taxes.

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Notes

Notes

In addition, shares of 15.9 million euros were acquired in thefiscal year in entities that were not included in the consolidated
financial statements. This figure relates mainly to the shares inCore Visual Inspection Services, Inc., Austin, USA, Transteam
Personal Holding AG, Mels, Switzerland, and its subsidiaries,
and Epoche & Espri S.L.U., Madrid, Spain.

5

STATEMENT OF COMPREHENSIVE INCOME/
INCOME STATEMENT

The statement of comprehensive income has been prepared using
the nature of expense method. Income and expenses attributable
to the fiscal year are recognized through profit or loss. Nonowner-based transactions reported as other comprehensive
income are presented after the income statement (one statement
approach).
5.1 Revenue

Within the business units, revenue is broken down by services
that exist regionally and internationally throughout the Group.
The revenue results from ordinary activities.
Revenue also includes income from unbilled service contracts as of year-end of 38,375 thousand euros (prior year:
34,594 thousand euros), which are recognized according to theirpercentage of completion.
Of the revenue, 1,901.3 million euros (prior year:
1,739.9 million euros) relates to Germany, 396.2 million euros(prior year: 379.7 million euros) to France and 837.3 million euros(prior year: 784.0 million euros) to other countries.

Revenue by Ser vice Line
5.2 Other operating income
IN THOUSAND EUR

2017

2016

Vehicle Inspection

955,189

916,634

Expertise

318,085

302,067

Automotive Solutions

188,852

177,957

Homologation & Type Approvals

29,69630,450Claims Services

36,42838,951Other Automotive income

29,27735,224

1,557,527

1,501,283

Automotive Services

Industrial & Construction­I nspection

405,756

377,990

Material Testing & Inspection

160,353

155,071

Product Testing & Certification

177,028

164,256

Business Assurance

82,21376,547

Insight

71,02374,8880

2,700

Other Industrial income

DEKRA

Other operating income of 31.9 million euros (prior year:
27.9 million euros) chiefly includes current income of 19.4 million euros (prior year: 19.3 million euros). This includes income
from the disposal of non-current assets of 6.3 million euros(prior year: 2.9 million euros) as well as reintegration and wage
subsidies totaling 2.6 million euros (prior year: 2.1 million euros). Other operating income also includes exchange
gains of 2.0 million euros (prior year: 1.7 million euros), income
from compensation of 1.8 million euros (prior year: 1.6 million
euros) as well as income from the reversal of allowances of
1.5 million euros (prior year: 1.8 million euros).

5.4 Personnel expenses
IN THOUSAND EUR

2017

2016

Wages and salaries

1,676,352

1,522,055

Social security costs(excl. pension insurance premiums)

219,091

196,620

Pension costs

126,193

113,765

2,021,636

1,832,440

Pension costs also include employer contributions to the statutory pension insurance fund of 91.9 million euros (prior year:
81.5 million euros). The majority of group employees are salaried
employees.
The Group’s employees are distributed as follows (annual
average):
2017

2016

Business Unit DEKRA Automotive

15,57915,772Business Unit DEKRA Industrial

8,134

7,777

Business Unit DEKRA Personnel

16,756

13,388780

688

41,24937,625A N N UA L AV E R AG E

DEKRA SE/Regional central units

5.3 Cost of materials

Cost of materials breaks down as follows:
5.5 Other operating expenses
2017

2016

Cost of purchased services

279,305

274,715

28,25826,728IN THOUSAND EUR

Industrial Services

896,373

851,452

Cost of purchased merchandise

Training & Education

197,260

185,494

Expenses from the write-down of
inventories

Temporary Work452,830

335,423

Personnel Services

650,090

520,917

Other

30,83729,993

3,134,827

2,903,645

Financial Report 2017

47

49

0

307,612301,443

DEKRA

Other operating expenses of 554.3 million euros (prior year:
536.0 million euros) chiefly include rent and rent incidentals of
124.7 million euros (prior year: 121.3 million euros), travel
expenses of 103.3 million euros (prior year: 97.5 million euros),
administrative expenses of 79.4 million euros (prior year:
76.9 million euros), IT and telephone costs of 64.8 million euros(prior year: 61.3 million euros) and vehicle costs of 44.5 million euros (prior year: 39.7 million euros). Other operating
expenses contain exchange differences of 2.8 million euros (prioryear: 1.3 million euros).

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

5.6 D epreciation, amor tization and impairment losses onproper t y, plant and equipment and intangible assets

The composition of depreciation, amortization and impairment
losses is presented in the statements of changes in intangible
assets and property, plant and equipment.
5.7 Financial result

The financial result breaks down as follows:
IN THOUSAND EUR

Investment result from companies
accounted for using the equity method

2016

2017

1,353

959

721

1,556

Expenses from investments andshares in affiliates–1,370–1,071Result from securities

6,402

59

0

–1

Other financial result

5,753

543

Interest income

6,170

5,391

Interest expenses–23,781–30,188–13,144–17,781

Other investment result

Result from loans

thereof other interest expenses
thereof net lending from­G erman phased retirement
scheme obligations

15

13–10,652–12,420

Interest result–17,611–24,797

Financial result–10,505–23,295

thereof net lending from­p ension provisions

The investment result from companies accounted for using theequity method of 1,353 thousand euros (prior year: 959 thousand euros) relates to the recognition of profit shares of FSD
Fahrzeugsystemdaten GmbH, Dresden, Germany and EuroTransport Media Verlags- und Veranstaltungsgesellschaft mbH,
Stuttgart, Germany.
Other financial result mainly comprises income from thereclassification of remeasurement effects of AfS securities fromother comprehensive income to the income statement due to thecontribution of these securities to the Contractual Trust

DEKRA

Arrangement (CTA). Reference is made to the explanations in
section 6.14 with regard to the CTA.
Interest income primarily stems from interest income from loans
and receivables of 2,531 thousand euros (prior year: 2,928 thousand euros) and from securities held for sale of 1,020 thousand euros (prior year: 1,139 thousand euros). Moreover, measurements in foreign currencies had an effect of
2,520 thousand euros (prior year: 907 thousand euros) on interest income.
Other interest expenses of 13,144 thousand euros (prioryear: 17,781 thousand euros) chiefly stem from short-term andlong-term loans. Moreover, this includes expenses from theincrease in liabilities from put and call options in connection
with subsidiaries acquired in prior years of 3,750 thousand euros(prior year: 2,320 thousand euros) as well expenses from currency effects of 2,023 thousand euros (prior year: 2,616 thousand euros). The decrease in other interest expenses is mainly
due to loans maturing as well as derivative financial instrumentsin the prior year.
Net lending from pension provisions results from interest
expenses arising from pension obligations of 16,356 thousand euros (prior year: 19,329 thousand euros) and the expected
return on plan assets of 5,704 thousand euros (prior year:
6,909 thousand euros).
5.8 Income taxes

Income taxes include taxes paid or owed on income as well asdeferred taxes.
Tax allocations to DEKRA e.V., Stuttgart, of 48.8 million euros (prior year: 33.6 million euros) are also recognizedunder income taxes. The tax allocation corresponds to the actual
tax incurred up to the level of DEKRA SE. The resulting receivables and liabilities are included under receivables and liabilities
to affiliates.
IN THOUSAND EUR

Current taxes

2017

2016

72,831

56,123–13,858–7,095724

812

59,697

49,840Current taxes contain tax expenses of –262 thousand euros (prioryear: –496 thousand euros) relating to other periods.
As of the reporting date, the DEKRA Group disclosed
16,090 thousand euros in total of unused tax losses (prior year:
22,228 thousand euros), which resulted in deferred tax assets of
5,108 thousand euros (prior year: 7,024 thousand euros). The
Group considers it probable that future taxable profit will beavailable against which they can be utilized. The respective local
tax rate was used in each case.

Deferred taxes from temporary measurement differences were
determined using future anticipated local tax rates, e.g., 30.5 %(prior year: 30.5 %) for Germany, 28.0 % (prior year: 33.3 %) forFrance and 25.0 % (prior year: 25.0 %) for the Netherlands.
No deferred taxes were recognized on retained earnings
from subsidiaries, since the profits are to remain invested in thesubsidiaries for the time being.

The deferred taxes as of December 31, 2017 break down as follows:
DEFERRED TAX ASSETSIN THOUSAND EUR

Unused tax losses

Financial Report 2017

DEFERRED TAX LIABILITIES

Dec. 31, 2017

Dec. 31, 2016

Dec. 31, 2017

Dec. 31, 2016

Non-current assets

61,66922,70029,93636,250Current assets

8,704

4,869

4,150

4,978

128,006

126,099

57,011

16,376

3,485

2,260

8,364

8,201

8,094

6,477

844

220

209,958

162,405

100,305

66,025

5,108

7,024

0

0

Total deferred taxes

215,066

169,429

100,305

66,025

Offsetting at tax group level–65,971–25,836–65,971–25,836

Disclosure

149,095

143,593

34,33440,189Non-current liabilities
Pension provisions
Other non-current liabilities
Current liabilities
Deferred taxes on temporary measurement differences

Deferred taxes on unused tax losses

Deferred taxes
Temporary differences

49

DEKRA

Financial Report 2017

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

The following tax reconciliation clarifies the difference between
the effective tax expense according to the statement of comprehensive income and the tax expense that would theoreticallyarise if the tax rate of DEKRA SE were to be applied to consolidated earnings before taxes. As in the prior year, the DEKRA
Group’s tax rate is 30.525 %.
2017

2016

Consolidated earnings before tax

192,540

157,727

Expected tax expense (30.525 %)

58,77348,146

Losses for which no deferred taxes
were recognized

1,253

3,836

Differences from foreign tax rates–1,569–1,032

Tax-free income–4,164–2,767

Non-deductible expenses

4,748

4,782

Tax items relating to other periods

611–3,242Other tax effects

45

117

59,697

49,840IN THOUSAND EUR

Effective tax expense

Deferred income tax assets and current income tax assets

5.9 Statement of comprehensive income

The Group has unused tax losses that can be carried forward
indefinitely of 30,908 thousand euros (prior year: 36,288 thousand euros), for which no deferred taxes were recognized, since
it is not yet sufficiently certain that they will be usable for tax
purposes.
Deferred tax assets and liabilities were offset at tax grouplevel provided the requirements for offsetting pursuant to
IAS 12.74 were met.
Of the change in deferred taxes, an amount of –28 thousand
euros (prior year: 17,266 thousand euros) was reported in othercomprehensive income. There were also changes in the deferredtaxes from first-time consolidations as well as from currencytranslation effects.
The current income tax receivables primarily pertain toclaims for tax credits to promote competitiveness and employment in France.

The consolidated net income for the year under IFRSs stands at
132.8 million euros (prior year: 107.9 million euros). This serves
as a basis for developing the income statement into the statementof comprehensive income. Items affecting other comprehensive
income include the remeasurement of defined benefit plans of
5.9 million euros (prior year: –60.2 million euros). This effectand the related deferred taxes of –1.3 million euros (prior year:
18.0 million euros) will not be recycled through profit or loss infuture. Other items affecting other comprehensive income are
the remeasurement of available-for-sale securities of –4.5 million euros (prior year: 0.3 million euros) and hedging instruments of 0.5 million euros (prior year: 2.0 million euros). It is
possible that these items will be recycled through profit and loss
in future together with the associated deferred taxes of 1.3 million euros (prior year: –0.7 million euros).
Reclassification adjustments from other comprehensive
income to profit or loss in the fiscal year are explained in note 10.
In addition, expenses from currency translation of 19.0 million euros (prior year: income of 5.2 million euros) were recognized in other comprehensive expenses. The effects of foreign currency translation are primarily due to translation of items fromthe US dollar, New Zealand dollar and Brazilian real. These items
could also be recycled through profit and loss in future if certain
conditions are met.

Deferred income tax liabilities and current income tax­l iabilities

Besides those from effective tax obligations, tax liabilities arise
mainly from deferred taxes. The recognition and measurement
differences determined from adjustments of the statements offinancial position of the consolidated companies according tolocal GAAP to IFRSs and consolidation entries recognizedthrough profit or loss, which resulted in deferred tax assets or
liabilities, are presented in the table above. Deferred tax liabilities of 2.8 million euros (prior year: 0.7 million euros) were recognized due to first-time consolidation.
Current tax liabilities mainly relate to income tax liabilities
of foreign entities. The liabilities from tax allocations to
DEKRA e.V., Stuttgart, amounting to 48.8 million euros havebeen offset against receivables from affiliates.

DEKRA

Financial Report 2017

6

DEKRA

51

STATEMENT OF FINANCIAL POSITION

Non - current assets
6.1 Intangible assets

In addition to goodwill, items include customer lists acquired
for a consideration, franchises, industrial and similar rights andassets, and internally generated intangible assets (IT developments).
The additions to amortization are recognized under theitem “Depreciation, amortization and impairment losses”. In thefiscal year, franchises, industrial rights and similar rights of
1,825 thousand euros (prior year: 4,912 thousand euros) wereimpaired as they were no longer expected to be used. In addition,
impairment losses were recognized for customer lists of
1,577 thousand euros (prior year: 5,009 thousand euros).
Internally generated intangible assets of 6,442 thousand euros (prior year: 3,811 thousand euros) were recognized
for software developments in the reporting period.
No impairments were necessary for goodwill in the reporting year.

Financial Report 2017

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

Cost as of Jan. 1, 2016

6.2 Goodwill

INTANGIBLE ASSETSIN THOUSAND EUR

Goodwill

Franchises,industrial andsimilar rights

Other­i ntangible
assetsInternallygeneratedintangible
assets

Prepayments
and intangible
assets underdevelopment

Total

514,007

107,791

212,016

22,27430,543886,631

Exchange difference on opening balance

3,111

30

291

89

3

3,524

Exchange difference in current year

1,040

–8

353

–79

–2

1,304

Additions

1,722

6,642

2,696

3,811

10,17825,049Additions to the consolidated group

15,133

2

2,009

0

–2

17,142

Disposals–834–1,004–1,1170–3,289–6,244

Reclassifications–96

21,022

197

5,148–26,463–192

As of Dec. 31, 2016 / Jan. 1, 2017534,083

134,475

216,445

31,243

10,968927,214

Exchange difference on opening balance–14,521–69–5,157–274–2–20,023

Exchange difference in current year

–280

–18

–61

–157

1

–515

313

9,397

2,330

6,442

7,662

26,144

Additions to the consolidated group32,18451

10,7760043,011

Disposals–1,915–416–1,546–53–296–4,226

Additions

Reclassifications–18

10,839–1,923

1,116–8,024

1,990

As of Dec. 31, 2017

549,846

154,259

220,864

38,317

10,309973,595

Depreciation and impairment losses as of Jan. 1, 2016

0–87,406–102,178–12,4860–202,070

Exchange difference on opening balance

0

–14

–549

–142

0

–705

Exchange difference in current year

–24

6

–484

83

0

–419

Additions–492–9,846–25,099–3,323–2,945–41,705

Disposals

0

899

1,103

726

2,945

5,673

Reclassifications

0

–71

–2

–4

0

–77

As of Dec. 31, 2016 / Jan. 1, 2017

–516

–96,432–127,209–15,146

0–239,303

Exchange difference on opening balance

62

35

2,837

49

0

2,983

Exchange difference in current year

–28

16

315

43

0

346

Additions0–14,175–23,276–3,264

0–40,715

Disposals

482

373

1,415

39

0

2,309

Reclassifications

0–3,123

2,401

0

0

–722

As of Dec. 31, 2017

0

–113,306–143,517–18,2790–275,102

Carrying amount as of Dec. 31, 2017

549,846

40,95377,347

20,03810,309698,493

Carrying amount as of Dec. 31, 2016

533,567

38,04389,236

16,097

10,968687,911

Carrying amount as of Jan. 1, 2016

514,007

20,385

109,838

9,788

30,543

684,561

DEKRA

Financial Report 2017

Accumulated goodwill amortization up to and including 2007,prior to application of IFRSs, was offset against cost.
Of the goodwill, 198.6 million euros (prior year: 176.5 million euros) relates to DEKRA Automotive, 308.9 million euros(prior year: 316.4 million euros) to DEKRA Industrial and42.3 million euros (prior year: 40.7 million euros) to DEKRA
Personnel.
Additions of 32.5 million euros to goodwill are attributableto business combinations and asset deals that took place in 2017as well as the inclusion in the consolidated group of entities
previously considered to be immaterial. However, goodwill
decreased by 14.8 million euros (prior year: increase of
4.2 million euros) due to currency translation differences.
The recoverable amount of each cash-generating unit wasdetermined using the value in use of the relevant unit. Cash flow

DEKRA

53

forecasts are based on detailed plans by management, coveringa three-year planning period. Management’s plans reflect pastexperience and expectations of future market and corporate
developments. Cash flows after the three-year period wereextrapolated taking into account estimated growth rates of 0.5 %(prior year: 0.5 %). The estimated growth rates came from forecasts by the Company. For DEKRA Automotive and DEKRA
Industrial, future cash flows were discounted using a risk-adjusted interest rate after tax of 7.0 % (prior year: 6.6 %) and for
DEKRA Personnel of 8.5 % (prior year: 7.9 %).
A 10 % decrease in the expected cash flows as well as a 1 %increase in the discount rate underlying the value in use calculation for the cash-generating unit, either individually or in combination, would not result in any impairment losses.
For more information, please refer to the explanations in
the descriptive section of the notes on impairment losses.

Financial Report 2017

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

6.3 Proper t y, plant and equipment

6.4 Financial assets accounted for using the equit y method

IN THOUSAND EUR

The separate financial statements of entities accounted for using
the equity method provide the following financial information,
which has not been adjusted to the share held by the Group:

Land and­b uildings

Technical
equipment andmachines

Other equipment,
furniture andfixturesPrepayments
and assets underconstruction

Total

IN THOUSAND EUR

Cost as of Jan. 1, 2016

574,630

18,55518,041Aggregated non-current assets

175,045

Exchange difference on opening balance

–181

497

–16

122

422

Aggregated current assets

37,48730,680Exchange difference in current year

130

673

–73

158

888

Aggregated non-current liabilities

19,395

16,729Additions

7,915

21,86725,2438,484

63,509Aggregated current liabilities

6,357

5,004

Additions to the consolidated group

2,089

1,928

205

39

4,261

Disposals–1,003–4,946–13,886–923–20,758

Reclassifications–5,015959–4,109–5,857–14,022

2017

2016

As of Dec. 31, 2016 / Jan. 1, 2017

185,243

196,023

215,577

12,087

608,930

Exchange difference on opening balance–1,285–4,188–1,043–261–6,777Aggregated revenue

40,34340,034

73

–251

–20

–221

–419

Aggregated net income for the year

3,301

2,945

12,374

21,07633,706

11,34478,500Additions

10,064

Dec. 31, 2016

181,308

Exchange difference in current year

208,213

Dec. 31, 2017

Additions to the consolidated group

6,277

1,880

473

201

8,831

Disposals–3,964–7,675–14,225–61–25,925

2,122

2,756

1,176

–8,249–2,195

Reclassifications

IN THOUSAND EUR

As in the prior year, the majority of assets, liabilities, revenue
and net income for the year is attributable to FSD Fahrzeug­
systemdaten GmbH, Dresden.

As of Dec. 31, 2017

200,840

209,621235,644

14,840660,945

Depreciation and impairment losses as of Jan. 1, 2016

–57,123–104,940–138,624–240–300,927

Exchange difference on opening balance

84

–338

–75

–70

–399

Exchange difference in current year

–58

–375

5

38

–390

Additions–6,140–18,544–21,773–8–46,465

Disposals

521

3,996

10,686291

15,494

Other investments

1,662

1,613

0

74

0

0

74

Loans to affiliates

21,968

8,897

Other loans

1,558

4,418

Available-for-sale securities

5,349

60,467

Reversal of impairment
Reclassifications

924

3,849

9,504

11

14,288–61,792–116,278–140,27722–318,325

Exchange difference on opening balance

427

2,365

366

–1

3,157

Exchange difference in current year

50

51

4

133

238

Additions–7,228–18,400–24,1870–49,815

Disposals

–97

7,224

10,5960

17,723As of Dec. 31, 2016 / Jan. 1, 2017

Reclassifications

1,611

2,965

–193

–3,457926

As of Dec. 31, 2017

–67,029–122,073–153,691–3,303–346,096

Carrying amount as of Dec. 31, 2017

133,81187,54881,953

11,537

314,849

Carrying amount as of Dec. 31, 2016

123,451

79,74575,30012,109290,605

Carrying amount as of Jan. 1, 2016

124,185

70,10569,5899,824

273,703

DEKRA

Financial Report 2017

6.5 Other non - current financial assets
IN THOUSAND EUR

Shares in affiliates measured at cost

Sundry other non-current financial
assetsDec. 31, 2017

Dec. 31, 2016

25,513

8,922

4,204

4,614

60,25488,931Other non-current assets contain impairment losses of
6,109 thousand euros (prior year: 780 thousand euros).

DEKRA

55

The increase in shares in affiliates measured at cost primarily
results from the acquisition of other entities. This was counterbalanced by the consolidation of entities that were not includedin the consolidated financial statements in the prior year. In thefiscal year, net impairment losses less reversals of impairment
losses of 757 thousand euros (prior year: 0 thousand euros) wererecognized.
The increase in loans to affiliates stems chiefly from thereclassification of loans to subsidiaries that are not fully consolidated due to changes in maturities. The loans contain accumulated impairments of 1,517 thousand euros (prior year:
1,730 thousand euros), which burdened the financial result for
the fiscal year by 159 thousand euros (prior year: 757 thousand euros).
The decrease in other loans is due first and foremost to thematurity of promissory notes.
The decline in available-for-sale securities primarily resultsfrom the contribution of securities to the CTA. Market valuationin the fiscal year had an overall positive effect on the portfolio.
Net reversals of impairments of 1,556 thousand euros (prioryear: 258 thousand euros) were recognized in this item in 2017.
Because of the contribution of the securities to the CTA, remeasurement effects of 6,163 thousand euros were reclassified fromother comprehensive income to the income statement.
The maturities of the material sundry other non-current
financial assets excluding the shares in affiliates measured atcost, other equity investments and available-for-sale securities
break down as follows:
Dec. 31, 2017

Thereof not
impairedDec. 31, 2016

Thereof not
impaired

Not past due

26,53526,535

16,992

16,992

Past due
between 1
and 90 days

3

0

0

0

Past due
between 91
and 180 days

1

0

123

0

Past due morethan 180 days

4,913

1,132

814

52

31,452

27,667

17,92917,044

IN THOUSAND
EUR

Financial Report 2017

56

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

Most of the sundry other non-current financial assets that are
not past due and not impaired are loans.

The maturities break down as follows:
IN THOUSAND
EUR

6.6 Other non - current assets

Dec. 31, 2017

Thereof not
impaired

6.9 Other current financial assets
Dec. 31, 2016

Thereof not
impairedDec. 31, 2017

Dec. 31, 2016

Reimbursement claims in accordancewith IAS 19.104a

1,125

1,031

Other non-current assets

4,652

4,505

5,777

5,536

Current assets

Not past due

332,123

332,123

344,621344,621

Past due
between 1
and 90 days

145,847

128,339

84,88364,883

Past due
between 91
and 180 days

37,79534,17916,901

10,806

Past due morethan 180 days

28,83012,81433,39912,347544,595

507,455

479,804

432,657

6.7 Inventories
Dec. 31, 2017

Dec. 31, 2016

Materials and supplies

1,759

1,488

Work in progress

1,465

3,141

Merchandise

4,305

3,892

7,529

8,521

IN THOUSAND EUR

The increase in receivables that are not impaired is mainly due
to the increase in revenue.
Bad debt allowances on trade receivables developed as­follows:
Dec. 31, 2017

Dec. 31, 2016

Bad debt allowances as of January 1–19,864–18,657

Additions–3,868–6,443

6.8 Trade receivables

Utilization

2,449

3,103

Foreign currency receivables are initially translated at theexchange rate on the transaction date in accordance withIAS 21.21; they are measured at the closing rate in accordance withIAS 21.23. The difference is recognized through profit or loss.

Reversal

3,265

2,133

–18,018–19,864

IN THOUSAND EUR

Trade receivables, grossReceivables from percentage ofcompletion
Portfolio-based specific valuation
allowances on trade receivables

Dec. 31, 2017

Dec. 31, 2016

502,318

440,290

42,277

Dec. 31, 2016

503

2,362

Receivables from affiliates andother investees and investors

108,737

128,753

Sundry other financial assets

64,07373,462

173,313204,577

Available-for-sale securities

Other non-current assets break down as follows:
IN THOUSAND EUR

Dec. 31, 2017

IN THOUSAND EUR

IN THOUSAND EUR

Bad debt allowances as of December 31–18,018–19,864

459,940DEKRA

IN THOUSAND EUR

Bad debt allowances as of January 1

Additions to impairment

Expenses incurred for the addition to specific bad debt allowances are included under other operating expenses.

39,514

526,577

Receivables from affiliates and other investees and investors contain liabilities from income tax and VAT, profit transfers from
DEKRA SE and other cost allocations to the owner totaling
101,800 thousand euros, which are offset against receivablesfrom the cash pool and other cost allocations of 195,522 thousand euros. The decrease in this item is primarily attributable tothe higher liabilities from profit transfers and income tax allocations compared to the prior year.
Sundry other financial assets primarily contain reimbursement claims from adjustment claims as of reporting date. The
decline is chiefly attributable to the maturity of time deposits
with a term of more than three months.
Impairment of other current financial assets developed asfollows:

Financial Report 2017

Change in fair value
Disposals
Disposals from the consolidatedgroup
Bad debt allowances as of December 31

Dec. 31, 2017

Dec. 31, 2016

–3,531–6,606–188–3,025

10

35

350

2,861

0

3,204

–3,359–3,531DEKRA

57

Impairment losses recognized through profit or loss mainly
relate to loans to non-consolidated subsidiaries.
The maturities of receivables from affiliates, investees andinvestors and other current financial assets break down as follows:
Dec. 31, 2017

Thereof not
impairedDec. 31, 2016

Thereof not
impaired

Not past due

165,021

165,021

189,940

189,940

Past due
between 1
and 90 days

4,953

4,450

6,083

3,333

Past due
between 91
and 180 days

466

455

3,684

1,685

Past due morethan 180 days

5,781

1,954

2,508

904

176,221

171,880

202,215

195,862

IN THOUSAND
EUR

6.10 Other current assets

This item principally contains prepaid expenses and other current tax receivables.
6.11 Cash and cash equivalents

The development of cash and cash equivalents as defined by
IAS 7 is presented in the statement of cash flows.
Cash and cash equivalents break down as follows:
Dec. 31, 2017

Dec. 31, 2016

Cash at banks

74,098133,303

Cash on hand

1,249

1,106

Cash equivalents less than 3 months

1,095

1,357

76,442

135,766

IN THOUSAND EUR

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Notes

Notes

Cash at banks includes short-term deposits with terms of up to
three months.
At present, no cash and cash equivalents are past due thatare not impaired.
6.12 Equit y

For information on the development of equity, please see thestatement of changes in equity.
The capital stock of DEKRA SE remains unchanged at
25,565 thousand euros. It is divided into 10,000,000 no-par value
bearer shares.
The capital reserves of 550,529 thousand euros (prior year:
520,529 thousand euros) mainly include contributions from
DEKRA e.V., Stuttgart. A contribution of 30,000 thousand euros
was made to the capital reserves in the fiscal year.
Revenue reserves contain the group profit for the period
and the profits of consolidated companies generated in prioryears to the extent these are not distributed or transferred. Thereis a profit and loss transfer agreement in place between
DEKRA SE and the parent. The profit transfer is reported inother comprehensive income as a transaction with the equity
investor. The difference between the profit transfer in accordancewith German commercial law and the IFRS result is recorded in
the revenue reserves. Changes in actuarial gains and losses fromdefined benefit plans, the gains or losses from the fair value
measurement of hedging instruments and available-for-salesecurities not recognized through profit or loss, deferred taxes
not recognized through profit or loss, and the translation reserve
are contained in accumulated other comprehensive income.
As of the reporting date, issued shares had all been fully
paid in.
6.13 Non - controlling interests

For the movement in non-controlling interests, please refer tothe statement of changes in equity.
There are non-controlling interests in those entities thatare shown in the list of shareholdings (note 14) with a share incapital of less than 100 %, unless options on the non-controllinginterests were arranged in the course of the business combination. A purchase price liability is recognized for these interestsin accordance with IAS 32 and non-controlling interests are
therefore not presented.

DEKRA

Pursuant to the revised IAS 27, the profit or loss for the year
attributable to non-controlling interests must be allocated to
non-controlling interests even if the losses exceed the share of
non-controlling interests in capital. Negative non-controllinginterests are not reported for those non-controlling interests towhich IFRS 3 (old version) applies.
The information below presents the required pro rata financial information of the significant entities with non-controllinginterests (DEKRA iST Reliability Services Inc., Hsinchu, Taiwan,
DEKRA iST Reliability Services Limited, Kunshan, China, and
DEKRA Testing Services (Zhejiang) Ltd., Zhejiang, China).
IN THOUSAND EUR

Dec. 31, 2017

Dec. 31, 2016

Aggregated non-current assets

7,392

6,811

Aggregated current assets

8,543

7,591

232

279

3,486

2,991

IN THOUSAND EUR

2017

2016

Aggregated revenue

8,814

7,765

Aggregated profit for the year

1,137

782

Aggregated non-current liabilities
Aggregated current liabilities

Of these amounts, non-current assets of 5,848 thousand euros,
current assets of 3,893 thousand euros, non-current liabilities of
232 thousand euros, current liabilities of 1,701 thousand euros,
revenue of 4,719 thousand euros and net income for the year of
710 thousand euros are attributable to DEKRA iST Reliability
Services Inc., Hsinchu, Taiwan.

Financial Report 20176.14 Pensions and other post- employment benefits
IN THOUSAND EUR

Pension provisions in Germany
Pension provisions in other countries

Dec. 31, 2017

Dec. 31, 2016

478,232

616,171

14,183

12,898492,415

629,069

The Group has both defined benefit and defined contributionplans for commitments for retirement, invalidity and surviving
dependants’ pensions based on works agreements and individual
contractual agreements.
These pension plans grant pension benefits, the level ofwhich depends on the length of service and eligible income.
The age limit is the respective legal retirement age for the statutory pension insurance. The pension is paid in part directlyby the companies that make the pension commitments and inpart by a legally independent welfare fund (DEKRA Unterstützungskasse e.V., Stuttgart).
The obligations relating to the consolidated member companies are included in full in these consolidated financial statements. The benefits are partly financed internally by systematic
accumulation of provisions and partly by contribution payments to employer’s pension liability insurance. The direct andindirect commitments are defined benefit obligations for whichassets (among other things through the conclusion of employer’s pension liability insurance policies) have been set aside
within DEKRA Unterstützungskasse e.V. In addition, DEKRA
set up a Contractual Trust Arrangement (CTA) effective October 24, 2017 to safeguard the pension obligations from thesepension plans. A trust agreement to safeguard pension entitlements was entered into with Allianz Treuhand GmbH, Stuttgart, which acts as the trustee in a two-tier trust arrangement(administrative trust and collateral trust). The funds transferred to fund the pension obligations are managed in trust by

DEKRA

59

Allianz Treuhand GmbH, Stuttgart, and are earmarked for use
solely for the payment of pension obligations.
The company pension scheme was reorganized with effectas of January 1, 2012. Claims vested prior to this date were notaffected. Within the scope of the reorganization, direct commitments were made as defined contribution plans in accordance with the rules of separately concluded works agreements.
The pension plan is described as a defined contribution plan,as the amount of the benefit is derived from and determinedby previously defined pension contributions. In addition to thepension contribution paid by the employer, employees canincrease this amount by converting salary components(deferred compensation).
The employer’s pension liability insurance and assets of
DEKRA Unterstützungskasse e.V. and the legally separate
funds of the CTA are treated as plan assets in accordance with
IAS 19.113. DEKRA Unterstützungskasse e.V. has an Advisory
Board which is regularly informed about the situation of theassets in the fund.
The pension provisions in other countries mainly relate
to pension plans and one-off termination benefits whenemployees commence retirement.
The defined benefit obligations are generally calculated
annually by independent actuaries using the projected unit
credit method. The 2005 G mortality tables of Prof. Dr. Klaus
Heubeck are used for the German pension obligations and recognized mortality tables are used for the foreign obligations.
At some foreign entities, there are multi-employer plansfor defined benefit plans, for which insufficient information isavailable.
Apart from the general interest, inflation, longevity andjurisdiction risks, there are no particular company-specificrisks for the existing plans. The longevity risk is taken into
consideration by using mortality tables when calculating theobligation. In particular, the mortality tables take into accountthe expected continued increase in life expectancy by means

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Notes

Notes

of appropriate assumptions. When calculating the obligation,
the inflation risk is adequately taken into account at 1.75 % p.a.
using a long-term approach and according to information cur-61

rently available. It also has an effect on the review of current
pensions. No employment-law related risks due to Supreme
Court rulings that could affect the plans are currently known.

Defined benefit plans

Details of the carrying amount posted to the statement of financial position for provisions for pensions and similar obligations are
as follows:
IN THOUSAND EUR

Benefitobligation

Plan assets (–)

Total

As of Jan. 1, 2016

890,294–313,408

Current service cost

19,666–361

Past service cost/plan curtailment

IN THOUSAND EUR

Benefitobligation

Plan assets (–)

Total

576,886

As of Jan. 1, 2017

970,221–341,152

629,069

19,305Current service cost

20,7790

20,779

854

0

854

707

0

707

Net interest cost (standard interest)

19,329–6,90912,420Net interest cost (standard interest)

16,356–5,704

10,652

Net pension cost

39,702–7,27032,432

Net pension cost

37,989–5,70432,2850–2,114–2,114

Actual return on plan assets less net interest cost0

–1,101–1,101

1,195

0

1,195

–6,8480–6,848

889

0

889

–1,101–5,865

Actual return on plan assets less net interest cost
Actuarial gain/loss from changes in demographic assumptions

Past service cost/plan curtailment

102

0

102

61,618061,618

628

0

628

Remeasurement of defined benefit pension plans

62,348–2,11460,234Remeasurement of defined benefit pension plans–4,764

Benefits paid

–26,354

13,951–12,403

Benefits paid

–27,294

14,796–12,498

Employer contributions

1–27,999–27,998

Employer contributions–402–150,189–150,591

Employee contributions

4,348–4,3480

Employee contributions

6,185–6,1850–22,005–18,396–40,401–21,511–141,578–163,089

–118

36

–82

28

–13

15

As of Dec. 31, 2016

970,221–341,152

629,069

As of Dec. 31, 2017

981,963–489,548

492,415

thereof funded

924,141

thereof funded

932,247

thereof unfunded

46,080

thereof unfunded

49,716

Actuarial gain/loss from changes in financial assumptions
Change from asset ceiling unless contained in net interest expense

Total payments
Changes in the consolidated group

DEKRA

Financial Report 2017

Actuarial gain/loss from changes in demographic assumptions
Actuarial gain/loss from changes in financial assumptions
Change from asset ceiling unless contained in net interest expense

Total payments
Changes in the consolidated group

DEKRA

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Notes

Notes

Plan settlements are attributable to the settlement of obligations
due to the termination of employment relationships.
The weighted average term of the vast majority of benefit
obligations is 15.31 years (prior year: 15.73 years).
The expected future pension payments for the coming fivefiscal years are as follows:
IN THOUSAND EUR

Expected pension
benefit payments

2018

31,0662019

32,4352020

34,2902021

35,617

Key parameters

Sensitivit y analysis

When calculating the benefit obligation according to the projected unit credit method, the following key parameters apply
for the DEKRA Group:

The table below shows the effects on the benefit obligation as aresult of any change in the parameters. The analysis relates toparameters where a change was considered possible as of thereporting date. Any correlation between the parameters was nottaken into account in the calculation.

IN %Dec. 31, 20172022

37,531The benefit obligation in proportion to plan assets reflects thefunded status of the benefit plan in question, with any excess ofthe benefit obligation over plan assets constituting a plan deficit.
Both the benefit obligation and plan assets can vary over time,leading to an increase/decrease in the plan deficit. Reasons forsuch fluctuation can include changes in market interest rates
and thus in the discount rate, or adjustments to actuarial
assumptions.
The DEKRA Group’s plan assets mostly comprise employer’s pension liability insurance policies and are subject to only
limited fluctuation on account of the existing minimum returns.
The initial addition to the CTA of 122.2 million euros was madeprimarily from the contribution of specialized funds and cash
and cash equivalents. In principle, the separate trust assets of the
CTA are subject to the same risks as direct capital investments.
We refer in this respect to our explanations in note 10. The recognized plan deficit is mostly covered by cash flow from operating activities.
It is the long-term goal of the DEKRA Group to gradually
increase plan assets in order to cover the deficit.

GERMANYOTHER COUNTRIES

Dec. 31, 2016

Dec. 31, 2017

Changes inassumptions

Increase inassumption

Decrease inassumption

Interest rate

1.75

1.75

1.18

1.65

Increase insalaries

2.00

2.00

1.00

1.85

Interest rate

0.5 %

6.7 %
decrease

7.5 %increase

Increase inpensions

1.75

1.75

1.50

1.50

Increase insalaries

0.5 %

0.2 %
increase

0.2 %decrease

Increase inpensions

0.5 %

6.1 %
increase

5.5 %decrease

Employee turnover

0.5 %

0.1 %
decrease

0.1 %increase

One year

4.6 %increase

4.6 %decrease

Age

Financial Report 2017

Part of the pension costs relating to the majority of employees,
especially in Germany, is the statutory pension. For several German and foreign entities, there are voluntary defined contribution plans for post-employment benefits. Expenses related todefined contribution plans, including pension insurance contributions, amounted to 101.4 million euros in the fiscal year (prioryear: 90.6 million euros). The future amount of these expenses
essentially depends on the development of the underlying pension insurance systems.

Plan assets

The fair value of plan assets breaks down as follows by asset class:Dec. 31, 2017

thereofmarketprice
quoted onan active
marketDec. 31, 2016

thereofmarketprice
quoted onan active
marketEmployer’s
pension liability insurance
policies

297,2450274,234

0

Securities

178,5420

54,6870

13,761

0

12,231

0

489,5480341,1520

IN THOUSAND
EUR

Other

DEKRA

The employer contributions to plan assets are expected toamount to 11.1 million euros in the next fiscal year (prior year:
27.8 million euros). In addition, the Group intends to contributean additional 60.0 to 65.0 million euros to the CTA in subsequent years to reduce the existing deficit further.
Defined contribution plans

Dec. 31, 2016

The figures given are averages weighted with the present valueof the benefit obligation in question. The obligations in othercountries, which are determined taking into account country-specific measurement bases and parameters, are immaterial.
German pension commitments are partly financed through
DEKRA Unterstützungskasse e.V., Stuttgart, which was includedin the consolidated financial statements through the consolidated member companies. The assets of DEKRA Unterstützungskasse e.V., Stuttgart, meet the criteria necessary to qualify
as plan assets in accordance with IAS 19.
For individual entities, pension commitments are financed
through payments to an insurance company. The resulting plan
assets include qualifying insurance policies only.

63

DEKRA

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Notes

Notes

65

6.15 Non - current and current provisions
IN THOUSAND EUR

IN THOUSAND EUR

As ofJan. 1, 2017

Allocation

Additions tothe consolidated group

Utilization

Reversal

Reclassifi­
cations

As ofDec. 31, 2017

As ofJan. 1, 2016

Allocation

Additions tothe consolidated group

Utilization

Reversal

Reclassifi­
cations

As ofDec. 31, 2016

Non-current provisions

Non-current provisions

Other personnel provisions

5,194

1,664

0

–1,086

–343

–594

4,835

Other personnel provisions

5,425

1,529

18

–1,622

–399

243

5,194

Phased retirement

177

747

0

–114

0

–594

216

Phased retirement

188

182

0

–436

0

243

177

thereof from phased
retirement obligation

1,488

298

0

–281

0

0

1,505

thereof from phased
retirement obligation

1,629

338

0

–479

0

0

1,488

thereof from phased
retirement plan assets–1,311

449

0

167

0

–594

–1,289thereof from phased
retirement plan assets–1,441

–156

0

43

0

243

–1,311Long-service award

3,279

783

0

–685

0

0

3,377

Long-service award

3,485

942

18

–1,167

0

0

3,279

Sundry otherpersonnel provisions

1,739

134

0

–287

–343

0

1,243

Sundry otherpersonnel provisions

1,752

405

0

–19

–399

0

1,739

Other non-personnel provisions

13,527

1,958

0

–756

–711

0

14,018Other non-personnel provisions

10,658

4,183

0

–561

–753

0

13,527

18,7213,622

0–1,842–1,054–594

18,85316,0835,712

18–2,183–1,152

243

18,721

3,739

2,018

93

–475

–904

0

4,471

21

1,087

0

0

0

0

1,108

12,3985,875

0–2,053–796

015,424

0

364

0

0

0

0

364

Current provisions

Current provisions

Other personnel provisions

Other personnel provisions

4,471

2,825

0

–2,988–564–1,3972,347

Restructuring provision

1,108

–5

0

–886

–217

0

0

15,4246,138

0–3,234–1,218

1,445

18,555

364

128

0

–296

0

0

196

Potential losses

1,449

944

0

–636

–440

0

1,317

Potential losses

1,010

727

0

–267

–21

0

1,449

Sundry other non-personnel
provisions

13,6115,066

0–2,302

–778

1,445

17,042Sundry other non-personnel
provisions

11,3884,784

0–1,786–775

013,611

21,0038,958

0–7,108–1,99948

20,902

16,1588,980

93–2,528–1,700021,003

Other non-personnel provisions
Other restructuring

Restructuring provision
Other non-personnel provisions
Other restructuring

In France, there are non-current obligations in relation to warranties of 11,403 thousand euros (prior year: 10,998 thousand euros), the risks of which exceed the insurance cover. There
are also long-term obligations based on country-specific dues.
Non-current provisions do not include significant effects ofunwinding the discount (prior year: 256 thousand euros).

DEKRA

Financial Report 2017

DEKRA

Other current provisions primarily include legal, consulting
and litigation risks as well as costs in connection with accreditations.
The provisions cover all identifiable obligations to third
parties in accordance with IAS 37. They are recognized in theamount that will probably be required.

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Notes

Notes

6.16 Non - current and current financial liabilities
Non - current financial liabilities
IN THOUSAND EUR

Liabilities to banks

Dec. 31, 2017

Dec. 31, 2016

228,159

266,782

0

130

105

1,062

2,275

2,124

Other financial liabilities

41

82

Liabilities from business­c ombinations

1,616

453

232,196

270,633

Trade payables
Derivative financial instruments
Lease liabilities

Current financial liabilities
IN THOUSAND EUR

Dec. 31, 2017

Dec. 31, 2016

Liabilities to banks

65,43912,741

Profit participation rights

14,883

15,197

Financial liabilities to affiliates

26,35021,036

Financial liabilities to associates

921

926

Financial liabilities to investees
and investors

027

Derivative financial instruments

465

5

Lease liabilities

1,219

700

Liabilities frombusiness combinations

19,91622,211

Liabilities to employees

33,04924,341Other financial liabilities

20,626

18,554

182,868

115,738DEKRA

The overall increase in non-current and current liabilities tobanks of 14,075 thousand euros is mainly due to borrowing
short-term loans. The shift from non-current to current liabilities to banks is essentially attributable to changes in the remaining terms.
Liabilities to affiliates include liabilities from the cash pool,income tax and VAT as well as other cost allocations, some ofwhich were netted with receivables from affiliates. The increaseof 5,314 thousand euros is primarily attributable to higher VAT
liabilities.
The increase in current liabilities to employees by
8,708 thousand euros is mainly due to the business developmentin the Temporary Work Service Unit.
DEKRA SE granted its managers and employees theoption of subscribing to profit participation rights of up to
10,737 thousand euros (4.2 million profit participation rights at
2.55645 euros each). Of this total, 2,825,536 (prior year:
2,893,170) profit participation rights were subscribed. The subscribed participation capital ensures participation in the adjusted
consolidated earnings of DEKRA SE with a minimum return of
4 % p.a. and a maximum return of 30 % p.a. Subscribed profit
participation rights can be terminated unilaterally by the recipient at short notice at any time.
6.17 Trade payables

Compared with the prior year trade payables rose by 8,810 thousand euros to 98,350 thousand euros.
6.18 Other non - current and current liabilities

Other non-current non-financial liabilities primarily include liabilities to the pension guarantee association and security deposits received.

Financial Report 2017

Other current liabilities break down as follows:
Dec. 31, 2017

Dec. 31, 2016

Personnel-related liabilities

198,458

188,400

Deferred revenue

14,997

16,818Other liabilities for taxes

53,96649,347

IN THOUSAND EUR

Prepayments received

37,831

39,765Social security

36,721

32,135

Sundry other

20,512

24,722362,485

351,187

Personnel-related liabilities chiefly relate to outstanding variablesalary components and accrued vacation.
Liabilities from taxes principally relate to VAT and wage tax.
The carrying amount of the liabilities is their fair value.
767

The cash flow from investing activities includes the following
payments from the acquisition and disposal of fully consolidated
subsidiaries:
IN THOUSAND EUR

Dec. 31, 2017

Dec. 31, 2016

Total purchase/sale price–38,017–11,451

thereof settled in cash

–38,017–10,620

thereof not yet settled/received

0

–831

Amount of cash and cash equivalents
acquired/disposed of

2,603

286

Non-current assets

47,808

8,796

Current assets

4,404

2,015

Non-current liabilities

11,707

1,231

Current liabilities

4,702

1,683

Amount of assets and liabilities
acquired/disposed of

STATEMENT OF CASH FLOWS

The statement of cash flows shows how the cash and cash equivalents changed during the course of the fiscal year as a result ofcash inflows and outflows. In accordance with IAS 7, a distinction is made between cash flows from operating, investing andfinancing activities. Cash flows from operating activities are
determined indirectly while cash flows from investing andfinancing activities are determined directly.
The composition of cash and cash equivalents matches thenet cash and cash equivalents disclosed in the statement of financial position as of the reporting date. Cash and cash equivalents
are not subject to any restrictions.

DEKRA

The cash flow from investing activities takes account of purchaseprice liabilities from the acquisition of fully consolidated subsidiaries from prior years amounting to 4,771 thousand euros.
Payments were 14 thousand euros higher than the liabilities recognized in prior years.
In addition, the cash flow from investing activities comprises purchase price payments of 15,911 thousand euros (prioryear: 2,372 thousand euros) for further subsidiaries and otherunits. These acquisitions resulted in liabilities due to variablepurchase price components of 2,062 thousand euros (prior year:
0 thousand euros).
The carrying amount of the receivables acquired approximates the fair value.

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Notes

Notes

The development of liabilities stemming from financing activities is as follows:
IN THOUSAND EUR

Carrying
amountDec. 31, 20168

Non-cash changes

Changes incash
Exchange
rate effects

Business
combinations

Change infair value

Ohterchanges

Carrying
amountDec. 31, 2017

Finance Lease

OTHER DISCLOSURES IN THE NOTES

8.1 Other financial obligations

Current loans

266,782–11,518

–728

8,055

0

–34,432

228,159

13,01916,566–1,6143,028

034,44065,439Derivative financial instruments

1,067

0

0

0

–492

–5

570

Lease liabilities

2,824

–892

18

650

0

894

3,494

Total liabilities from financing avtivities

283,692

4,156–2,324

11,733–492

897

297,662

Dec. 31, 2017

Liability fromlease
obligation

Rental and lease obligations in thecurrent year

1,076

–

thereof interest portion184–

IN THOUSAND EUR

The following rental and lease obligations from operating leases
relate primarily to obligations from property and vehicle leases.
Operating Lease

Non-current loans

IN THOUSAND EUR

Dec. 31, 2017

Dec. 31, 2016

Rental and lease obligations in thecurrent year

123,316

126,137

Residual term of less than 1 year

108,595

109,417

Residual term of 1 to 5 years

181,322

182,566

Residual term of more than 5 years

66,321

63,498

Total obligations for future years

356,238

355,481

Residual term of less than 1 year

1,224

1,219

Residual term of 1 to 5 years

2,306

2,275

0

0

3,530

3,494

Dec. 31, 2016

Verbindlichkeit
aus Leasing­verpflichtung

Residual term of more than 5 years
Total obligations for future years

Finance Lease
IN THOUSAND EUR

The rental and lease obligations of the current year contain contingent lease payments of 144 thousand euros (prior year:
917 thousand euros). Property leases generally have residual
terms of up to ten to 15 years. Subleases result in lease income of
4,157 thousand euros (prior year: 1,586 thousand euros).

Rental and lease obligations in thecurrent year

684–

thereof interest portion

86–

Residual term of less than 1 year

758

700

2,263

2,124

0

0

3,021

2,824

Residual term of 1 to 5 years
Residual term of more than 5 years
Total obligations for future years

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Notes

Notes

The difference between the total obligations for future years andthe lease liabilities recognized is the present value difference. The
assets recognized on the basis of the existing finance leases
amount to 4,324 thousand euros (prior year: 3,360 thousand euros). Of this total, an amount of 1,844 thousand euros is
attributable to land and buildings and 2,480 thousand euros toother plant and equipment. The leases contain purchase options.
No restrictions were imposed under the terms of these leases.
In 2017, the Group reported other financial obligations
including purchase commitments of 47,388 thousand euros(prior year: 19,576 thousand euros). These are mainly attributable to agreements concluded to purchase land and buildings aswell as to long-term framework agreements.
8.2 Contingent liabilities, other contingencies and­c ollateral provided

Contingent liabilities of 6,729 thousand euros (prior year:
5,571 thousand euros) mainly include bank guarantees and contingencies from guarantees. In addition, collateral and warranties of 1,218 thousand euros (prior year: 1,003 thousand euros)
have been issued. The risk of utilization is currently deemed to
be low.
The DEKRA Group is not involved in any court proceedings that could significantly affect its economic or financial situation.
8.3 Government grants

Government grants of 2,608 thousand euros (prior year:
2,072 thousand euros) were received in the past fiscal year. Mostof these relate to personnel-related grants.
9

CAPITAL M ANAGEMENTDEKRA pursues the goal of sustainably increasing equity. The
aim is to maintain an appropriate debt-to-equity ratio while
improving the EBIT margin. Equity was strengthened in thefiscal year by a contribution to the capital reserves of 30.0 million euros as well as an increase in the revenue reserves of
78.0 million euros. Differences from the currency translation of

DEKRA

the financial statements prepared in foreign currency by consolidated subsidiaries had a negative effect of 19.0 million euros onequity. The DEKRA Group’s equity ratio stood at 30.4 % (prioryear: 26.0 %) as of the end of the reporting period.
10 FI N A N C I A L M A N AG E M E N T

The Group’s financial management includes cash and liquidity
management as well as the management of market price risks(interest, currency) and credit default risks.
Cash management determines the required or surplus cash
for all DEKRA entities. Timely account management ensuresthat the necessary funds for payments are available where they
are needed, with the aim of keeping external investing and lending to a minimum.
Liquidity management ensures all payment obligations of
the entities in the DEKRA Group are always met. To this end,
the liquidity planning determines cash flows from operating
activities, secures foreseeable liquidity requirements at an earlystage and invests surplus liquidity on the money market.
Market price risk management is responsible for limiting
the impact of interest rate and currency fluctuations on theGroup’s earnings. For this purpose, the market price risks are
determined and used as a basis for hedging decisions. Such decisions include the selection of hedging instruments, the volume
to be hedged and the period to be covered. DEKRA used derivative financial instruments in the fiscal year to hedge variable-rate finance arrangements.
The risk volume involved in the management of default
risk includes securities investments and the investment of cash
and cash equivalents in financial institutions as part of liquidity
management, as well as the credit risk relating to end customers
due to the granting and systematic monitoring of payment terms
from trade.
Short-term investments of cash and cash equivalents are
only made with top-rated financial institutions and on the basisof current ratings of rating agencies as well as taking into
account current CDS spreads. We use commercial credit agen-Financial Report 2017cies to assess the creditworthiness of our customers and in casesof doubt, upfront payment or bank guarantees are required.
Financial instruments

IAS 39 requires financial assets and liabilities to be classified
under one of the following categories:a) Financial assets at fair value through profit or lossb) Loans issued and receivables measured at amortized costc) Held-to-maturity investmentsd) Available-for-sale assets at fair value not through profit or losse) Financial liabilities at fair value through profit or lossf) Financial liabilities at amortized cost
All financial assets of the DEKRA Group to be classified belong
to the categories “Loans issued and receivables at amortizedcost” or “Available-for-sale assets at fair value not through profit
or loss”. All financial liabilities belong to the categories “Financial liabilities at fair value through profit or loss” or “Financial
liabilities at amortized cost”.
The following table shows the net gains/losses for each category:
Dec. 31, 2017

Dec. 31, 2016

Loans issued and receivables
measured at amortised cost

439

–4,597Available-for-sale assets at fairvalue not through profit or loss

7,423

1,200

Financial liabilities at fair value
through profit or loss

–1,621–2,456

Liabilities measured at amortised cost

–4,971–7,7901,270–13,643

IN THOUSAND EUR

The increase in net gains from available-for-sale assets measured
at fair value in other comprehensive income is based chiefly on
the transfer of the specialized funds and other AfS securities to
the CTA.
The expense from financial liabilities at fair value throughprofit or loss stems from the increase in liabilities from put
options.
Before tax effects, the available-for-sale reserve decreasedon account of gains and losses arising from changes in fair value
amounting to 4.5 million euros (prior year: increase of 0.3 million euros) which were reported in other comprehensive income.
This includes a decrease of 6.2 million euros in the AfS reservefrom the reclassification of measurement effects of specialized
funds as well as of other AfS securities from other comprehensive income to the income statement due to the contribution of
those securities to the CTA. The measurement of the derivative
financial instruments not through profit or loss increases thereserve for hedging instruments by 0.5 million euros to –0.6 million euros (prior year: –1.1 million euros). Deferred taxes of
1.2 million euros (prior year: –0.7 million euros) had the opposite effect.
The following tables show a breakdown of line items into
categories and classes and the allocation of items measured atfair value in the statement of financial position to the fair value
hierarchy.

Net gains and losses mainly comprise interest expenses, interest
income, dividends, increases and impairments in value andimpairment losses as well as gains or losses on disposal. The
decrease in net losses for loans and receivables primarily resultsfrom lower expenses incurred for the allocation to specific bad
debt allowances.

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Notes

Notes

IN THOUSAND EUR

IN THOUSAND EUR

Carrying
amountDec. 31, 2017

Loans issued
andreceivables
measured atamortised
cost

Availablefor-saleassets at fairvalue
not throughprofit or loss

Fair value

thereoffair valuelevel 1

thereoffair valuelevel 2

thereoffair valuelevel 3

AssetsFinancialliabilities atfair value
not throughprofit or
loss

Financialliabilities atfair value
through
profit or
loss

105

105

0

1,616

0

228,159
2,275

Financialliabilities
measured atamortized
cost

Fair
value

thereoffair valuelevel 1

thereoffair valuelevel 2

thereoffair valuelevel 3

0

105

0

105

0

1,616

0

1,616

0

0

1,616

0

0

228,159

n/a

n/a

n/a

n/a

0

0

2,2752)

n/a

n/a

n/a

n/a

41

0

0

41

n/a

n/a

n/a

n/a

232,196

105

1,616

230,475

1,721

0

105

1,616

Trade payables

98,3500098,350

n/a

n/a

n/a

n/a

Profit participation rights

Non-current liabilities

Shares in affiliates and investees

27,175027,175

n/a

n/a

n/a

n/a

Securities

5,349

3

5,346

5,346

861

4,485

0

Loans

23,52623,526

0

n/a

n/a

n/a

n/a

Other financial assets

4,204

4,204

0

n/a

n/a

n/a

n/a

60,25427,73332,521

5,346

861

4,485

0

1)

Derivative financial instruments designatedas hedging instruments
Liabilities from business combinations
Financial liabilities
Finance lease liabilities
Other non-current liabilities

Current liabilities

Current assets

Trade receivables including
percentage of completion

526,577

526,577

0

n/a

n/a

n/a

n/a

Cash and cash equivalents

76,44276,442

0

n/a

n/a

n/a

n/a

503

343

160

160

160

0

0

Receivables from affiliates and investees

108,737

108,737

0

n/a

n/a

n/a

n/a

Other financial assets

64,07364,073

0

n/a

n/a

n/a

n/a

776,332

776,172

160

160

160

0

0

14,8830014,883

n/a

n/a

n/a

n/a

Derivative financial instruments
designated as hedging instruments

465

465

0

0

465

0

465

0

Derivative financial instruments notdesignated as hedging instruments

0

0

0

0

0

0

0

0

Liabilities from business combinations

19,916

0

19,916

0

19,9160

0

19,916

Financial liabilities

65,4390065,439

n/a

n/a

n/a

n/a

Liabilities to affiliates

26,3500026,350

n/a

n/a

n/a

n/a

921

0

0

921

n/a

n/a

n/a

n/a

0

0

0

0

n/a

n/a

n/a

n/a

Liabilities to associates
Liabilities to other investees and investors

836,586
1)

Carrying
amountDec. 31, 2017

Equity and liabilities

Non-current assets

Securities

73

803,905

32,681

5,506

1,021

T his contains available-for-sale assets measured at cost of 27,175 thousand euros for which it is not possible to reliably determine a fair value.
No sale is expected. In the absence of a specific term, the non-current assets were allocated to the available-for-sale category.
The fair values would factor in future effects.

DEKRA

Financial Report 2017

4,485

Other current liabilities

53,6750053,675

n/a

n/a

n/a

n/a

Finance lease liabilities

1,219

0

0

1,2192)

n/a

n/a

n/a

n/a

281,218465

19,916

260,837

20,381

0465

19,916

513,414570

21,532

491,312

22,1020570

21,5320
2)Measured in accordance with IAS 17.

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Notes

Notes

IN THOUSAND EUR

IN THOUSAND EUR

Carrying
amountDec. 31, 2016

Loans issued
andreceivables
measured atamortised
cost

Availablefor-saleassets at fairvalue
not throughprofit or loss

Fair value

thereoffair valuelevel 1

thereoffair valuelevel 2

thereoffair valuelevel 3

AssetsFinancialliabilities atfair value
not throughprofit or
loss

Financialliabilities atfair value
through
profit or
loss

1,062

1,062

0

453

0

Financialliabilities
measured atamortized
cost

Fair
value

thereoffair valuelevel 1

thereoffair valuelevel 2

thereoffair valuelevel 3

0

1,062

0

1,062

0

453

0

453

0

0

453

Non-current liabilities

Shares in affiliates and investees

10,5350

10,535

n/a

n/a

n/a

n/a

Securities

60,467566

59,901

59,901

9,124

50,7770Loans

13,315

13,315

0

n/a

n/a

n/a

n/a

Other financial assets

4,614

4,614

0

n/a

n/a

n/a

n/a

88,931

18,49570,43659,901

9,124

50,77701)

Derivative financial instruments designatedas hedging instruments
Liabilities from business combinations
Financial liabilities

266,78200266,782

n/a

n/a

n/a

n/a

2,124

0

0

2,1242)

n/a

n/a

n/a

n/a

212

0

0

212

n/a

n/a

n/a

n/a

270,633

1,062

453

269,118

1,515

0

1,062

453

Trade payables

89,5400

089,540

n/a

n/a

n/a

n/a

Profit participation rights

Finance lease liabilities
Other non-current liabilities

Current liabilities

Current assets

Trade receivables including
percentage of completion

459,940

459,940

0

n/a

n/a

n/a

n/a

Cash and cash equivalents

135,766

135,766

0

n/a

n/a

n/a

n/a

2,362

202

2,160

2,160

2,160

0

0

Receivables from affiliates and investees

128,753

128,753

0

n/a

n/a

n/a

n/a

Other financial assets

73,462

73,462

0

n/a

n/a

n/a

n/a

800,283

798,123

2,160

2,160

2,160

0

0

889,2141)

Carrying
amountDec. 31, 2016

Equity and liabilities

Non-current assets

Securities

75

816,618

72,596

62,061

11,284T his contains available-for-sale assets measured at cost of 10,535 thousand euros for which it is not possible to reliably determine a fair value.
No sale is expected. In the absence of a specific term, the non-current assets were allocated to the available-for-sale category.
The fair values would factor in future effects.

DEKRA

Financial Report 2017

50,777

15,19700

15,197

n/a

n/a

n/a

n/a

Derivative financial instruments
designated as hedging instruments

0

0

0

0

0

0

0

0

Derivative financial instruments notdesignated as hedging instruments

5

0

5

0

5

0

5

0

22,211

0

22,211

0

22,2110022,211

Financial liabilities

12,7410012,741

n/a

n/a

n/a

n/a

Liabilities to affiliates

21,0360021,036

n/a

n/a

n/a

n/a

Liabilities to associates

926

0

0

926

n/a

n/a

n/a

n/a

Liabilities to other investees and investors

27

0

0

27

n/a

n/a

n/a

n/a

Liabilities from business combinations

Other current liabilities

42,8950042,895

n/a

n/a

n/a

n/a

Finance lease liabilities

700

0

0

7002)

n/a

n/a

n/a

n/a

205,278

022,216

183,062

22,2160

522,211475,911

1,062

22,669452,180

23,7310

1,067

22,6640
2)

Measured in accordance with IAS 17.

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Notes

Notes

The levels of the fair value hierarchy and their application to ourassets and liabilities are described below:
Level 1:	Market prices quoted on active markets for identicalassets or liabilities
Level 2:	Other information than quoted market prices that canbe directly (e.g., prices) or indirectly (e.g., derived fromprices) observed
Level 3:	Information relating to assets and liabilities that is notbased on observable market data
Development of level 3 of the fair value hierarchy:
IN THOUSAND EUR

As of January 1

Dec. 31, 2017

Dec. 31, 2016

22,66423,449Additions

2,062

823

Disposals–4,815–4,064

Fair value changes

1,621

2,456

As of December 31

21,532

22,664The contingent purchase price liabilities were recognized at present value.
The non-observable input parameters of liabilities frombusiness combinations primarily include factors such as theoperating result, earnings before depreciation and amortization,
financial result and income tax or the development of the working capital of the acquired business.
As of the reporting date, there are significant purchaseprice liabilities for DEKRA New Zealand Ltd., Wellington, New
Zealand, Core Visual Inspection Services, Inc., Austin, USA,
Transteam Personal Holding AG, Mels, Switzerland and DEKRA
AQS Solutions, Inc., Minneapolis, USA.
Assuming a change of +10 % (–10 %) in the underlying
parameters regarding non-observable input factors as of the next
possible exercise date, the amount of the purchase price obliga-

DEKRA

tion, including put options and earn-outs, for the significant
obligations from business combinations would be 5 % higher(9 % lower).
Contingent purchase price liabilities of 4,815 thousand euros were
paid in the current fiscal year. An amount of 1,705 thousand euros
was expensed through profit or loss. This entire amount resultsfrom liabilities that still exist as of the reporting date.
Any future changes in value in the purchase price liabilities
will be recognized through profit or loss in subsequent periods.
The majority of contractually agreed maturity dates forfinancial instruments measured at amortized cost are withintwelve months of the reporting date. As such, their carrying
amounts as of the reporting date approximately equate to theirfair values. For all items of non-current financial assets and liabilities not recognized at fair value (except for non-current financial
liabilities), the carrying amount is equal to the fair value.
For loans with longer terms, the present value largely corresponds to the carrying amount as, for the most part, variableinterest rates based on market-dependent interest rates are usedin the contractual agreements.
As regards financial liabilities, the fair value of non-current liabilities due to banks bearing a fixed interest rate is determined based on the present value of the expected future cash
flows. The discount rates are based on market interest rates withreference to the maturities. The fair value of non-current financial liabilities with a carrying amount of 228,159 thousand euros
comes to 226,600 thousand euros (level 2).

Liquidit y risks

The liquidity required for operations and for implementing strategic measures is ensured through the cash and cash equivalents
held and bank loans committed in writing (working capitalcredit and acquisition lines). Cash and cash equivalents are heldin bank accounts or invested in the form of overnight money andtime deposits as well as short-term money market papers. A central cash pool has been set up at DEKRA SE for German subsidiaries as well as the increasing number of international subsidiaries from the euro zone. Cash pools have also been established
for the subsidiaries in the US (USD) and in the UK (GBP).
The entities are generally financed centrally through
DEKRA SE.
In order to visualize liquidity risks, the DEKRA Groupprepares an overview of maturities for its undiscounted payment
obligations arising from financial instruments.
As of December 31, 2017, the DEKRA Group was exposed
to only a very small risk of being unable to meet its payment
obligations arising from financial instruments in future. The
DEKRA Group requires sufficient liquidity for future acquisitions, which is ensured by the promissory notes and by longerterm loan commitments. As of December 31, 2017, there are
medium-term credit lines of 325.1 million euros granted in writing that have not yet been drawn.

As of the reporting date, the contractually agreed undiscounted
financial liabilities including interest broke down as follows:
D E C . 31, 2 017
IN THOUSAND EUR< 1 year

1–5 years> 5 years

Trade payables

98,3500

0Financial liabilities

68,906

137,648

99,775

Other financial liabilities

95,829410Derivative financial
instruments (negative)
designated as hedging
instruments

536

168

0

Finance lease liabilities

1,224

2,306

0

264,845

140,163

99,775D E C . 31, 2 016
IN THOUSAND EUR< 1 year

1–5 years> 5 years

Trade payables

89,5400

0Financial liabilities

15,073

118,691

159,237

Other financial liabilities

82,311212

0Derivative financial
instruments (negative)
designated as hedging
instruments

462

563

89

Finance lease liabilities

758

2,263

0

188,144

121,729

159,326

Risks from financial instruments

We also refer to our explanations on the contingent liabilities innote 8.2, which have an unlimited term.

Principles of financial management

The main goals of the DEKRA Group’s financial management
are to ensure solvency at all times and to limit financial risks.
Financial derivatives are only used for hedging purposes
for existing or foreseeable hedged items. This does not give riseto any additional risks for the Group. The transactions are only
carried out with marketable instruments.

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Notes

Notes

In addition to liabilities from promissory notes, the liabilities tobanks mostly include short- and medium-term utilization of
credit lines as well as investment financing of foreign subsidiaries.
Credit risk (default risk)

In the course of its operations, DEKRA is exposed to the risk ofdefault on outstanding receivables. The DEKRA Group counters
this risk with timely receivables management, which entails theregular monitoring of outstanding items as well as timely dunning and collection of receivables. Potential defaults areaccounted for using specific bad debt allowances and portfolio-based bad debt allowances. The maximum default risk is the
carrying amount of the receivables as of the reporting date. There
were no significant risk concentrations as of the reporting date.
DEKRA is also exposed to default risk in relation to cash
investments. In order to minimize these risks as far as possible,
we restrict our cash deposits to counterparties with first-classcredit ratings subject to defined counterparty limits. In addition,
there is a limit on the proportion of the entire investment volume
that may be invested with any one counterparty. Investments insecurities are only made with investment grade institutions. The
investment strategy and the development of securities are discussed by the investment committee at regular intervals.
The maximum risk of counterparty default is calculated
in accordance with the carrying amounts of the financial
assets as an equivalent for the maximum default risk. As of
December 31, 2017, therefore, the DEKRA Group was exposedto the theoretical maximum possible risk of counterparty default
apparent from the table above for the breakdown of carrying
amounts of the financial instruments.
No collateral is pledged by the counterparties for the financial instruments held. As of December 31, 2017, with the exception of trade receivables and loans, no material financial assets
were overdue or affected by amendments to contracts.

DEKRA

79

Interest rate risk

Cash flow hedges for variable - interest loans

Other price risks

In the course of our investing and financing activities, we areexposed to interest rate risks. For borrowings, such risks are
generally managed using interest rate derivatives in definedinterest rate hedge ranges. In relation to investing, interest rate
fluctuations result in changes in the fair values of fixed income
securities. For bonds most (and for shares all) long-term investments are made via funds. In order to manage price risks forthese investment items, financial derivatives are recognized by
the fund management by way of a hedge as necessary.
The interest rate risk for fixed-income securities is reflectedin the price of the financial instrument. Temporary changes invalue are reflected in the available-for-sale reserve in other comprehensive income; permanent impairments are recognizedthrough profit or loss. For variable-rate securities, changes ininterest rates impact directly on the financial result.
The risk for the statement of comprehensive income ismeasured in the DEKRA Group using a sensitivity analysis. This
analysis tests for the impact on interest income or interest
expense of a shift in the term structure of interest rates by 100
base points.
An upward shift of 100 base points would result in an
increase in the interest result of 1,282 thousand euros (prior year:
1,621 thousand euros). A downward shift of 100 base points
would result in a decrease in the interest result of 1,280 thousand euros (prior year: 1,036 thousand euros).
As there are no longer fixed-income securities in the portfolio, an upward shift of 100 base points would, as in the prioryear, have no effect on the available-for-sale reserve. A corresponding downward shift would also, as in the prior year, haveno effect on the available-for-sale reserve.
An upward shift of 100 base points would result in an
increase in the fair value of hedging instruments reported inequity of 434 thousand euros not taking tax effects into consideration. A downward shift of 100 base points would result in adecrease in the fair value reported in equity of 452 thousand euros before deferred taxes.
Interest derivatives were concluded to hedge the interest
risk for material variable-interest loans and reported as hedging
transactions as defined by IAS 39.

The rules on cash flow hedge accounting were applied for derivatives with a nominal volume of 28.5 million euros.
In order to hedge the interest risk of the promissory noteloans, interest derivatives were concluded in prior fiscal years,
thus largely fixing the interest expense on the loans.
Interest swaps are recognized at fair value. The effective
portion of the changes in the fair value of the interest swap determined as a cash flow hedge is recognized in equity; the ineffective portion of the changes in the fair value is recognizedthrough profit or loss. The cash flow hedges for the variable-interest portions of the loans did not lead to any ineffective hedges
in the fiscal year to be recognized in profit or loss. The payments
received and made from these interest swaps were netted in theinterest expense and are thus a component of the interest result.
The hedging transactions have remaining terms of between
one and five years.
The fair value of the derivative financial instruments,
which are interest rate hedges, is determined using the mark-tomarket method. This involves use of the discounted cash flow
method and customary market interest rates.

As part of the presentation of market risks, IFRS 7 also requires
disclosures on how hypothetical changes in risk variables
affect prices of financial instruments. Possible risk variables
include in particular stock market prices or indices. As of
December 31, 2017, the Group had available-for-sale financial
assets totaling 32.7 million euros (prior year: 72.6 million euros),which are subject to fair value fluctuations. The changes in fairvalue are presented in equity unless the conditions for an
impairment loss are satisfied. These risks are mainly due tointerest rate, credit and price risks. The fair value changes
averaged 5.13 % in 2017 and 0.47 % in 2016.

Financial Report 2017

Currency risks

Currency risks from the operating activities are immaterial,
since the local entities bill the services they render locallyalmost exclusively in their local currency. In connection withinvestments and intragroup transactions, liabilities occasionallyarise in foreign currencies, for which hedging is decided on acase-by-case basis.
A 10 % change in the rate of the euro against the Swedishkrona, the Brazilian real and the US dollar would affect the result
from the translation of short-term and long-term loans to affiliates by approximately 4.0 million euros not taking tax effects
into consideration. Decisions on necessary currency hedges aretaken on a case-by-case basis. No material effects are expectedfrom currency fluctuations for the other financial assets or liabilities. Group revenue includes revenue of 538.8 million euros(prior year: 520.1 million euros) that was not recorded in a eurozone country.

DEKRA

Securities and restricted assets

As in the prior year, there were no restrictions on title or disposal
for legally and beneficially owned property, plant and equipment, with the exception of the assets recognized under financeleases. Other assets include 1.1 million euros (prior year: 1.0 million euros) of premium reserve from employer’s pension liability
insurance policies pledged as collateral for pension obligations,but not to the entitled employees.
No financial assets were pledged as collateral for liabilities
or contingent liabilities.

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Notes

Notes

Transactions with DEKR A e.V., Stuttgar t

11 R E L A T E D P A R T Y D I S C L O S U R E S

Pursuant to IAS 24 “Related Party Disclosures”, transactions
with related parties must be disclosed. The Management Board
and Supervisory Board as well as owners qualify as related parties within the meaning of IAS 24.9.
Remuneration of the Management Board

The remuneration paid to Management Board members (shortterm benefits) comprises fixed annual compensation and a performance-related variable bonus.
Remuneration for the Management Board of DEKRA SE
including reimbursement of expenses amounted to 2,556 thousand euros (prior year: 2,511 thousand euros).
In addition, there were further expenses (among otherthings, for pensions of DEKRA SE) of 805 thousand euros (prioryear: 725 thousand euros) and obligations of 9,891 thousand euros (prior year: 8,685 thousand euros) relating to thisgroup of persons.
This results in a total remuneration of 3,361 thousand euros(prior year: 3,236 thousand euros).
Total remuneration paid to former members of the Management Board amounts to 399 thousand euros (prior year:
399 thousand euros). There are also pension obligations of
3,281 thousand euros.
Remuneration of the Super visor y Board

The remuneration paid to the Supervisory Board for the reporting year came to 203 thousand euros (prior year: 218 thousand euros), of which a total amount of 203 thousand euros(prior year: 218 thousand euros) is reported as liabilities as of thereporting date.
In addition, there were further expenses (among otherthings, for pensions of DEKRA SE) of 667 thousand euros (prioryear: 671 thousand euros) and obligations of 1,021 thousand euros(prior year: 983 thousand euros) relating to this group of persons.

DEKRA

There are liabilities of 24.8 million euros (prior year: 20.3 million
euros) to DEKRA e.V., Stuttgart, as of December 31, 2017, whichmainly stem from VAT liabilities. There are also receivables of
93.7 million euros (prior year: 103.1 million euros) that primarily result from the cash pooling less profit and loss transfer.
There are lease agreements in place between DEKRA e.V.,
Stuttgart, as lessor and various companies of the DEKRA Groupas tenants. Rent for business premises amounted to 19.8 million
euros in fiscal year 2017 (prior year: 19.6 million euros). Receivables from and liabilities to DEKRA e.V., Stuttgart, gave rise tointerest income of 1.5 million euros (prior year: 1.5 million
euros) and interest expenses of 0.3 million euros (prior year:
0.3 million euros). Tax allocations amounted to 48.8 million
euros (prior year: 33.6 million euros). In addition, services totaling 1.5 million euros (prior year: 1.6 million euros) were purchased from DEKRA e.V., Stuttgart.
Under a corporate lease agreement, activities are primarily
performed in the field of German automotive testing and expertise by an operating company of the Dekra Group for
DEKRA e.V., Stuttgart. Business is generally conducted in thename of and for the account of DEKRA Automobil GmbH, Stuttgart. All transactions and business processes are carried out at
DEKRA Automobil GmbH.
As remuneration for the activities, a flat-rate percentage ofthe profit generated before income taxes or of revenue is invoiced.
In fiscal year 2017, a total volume of 5.4 million euros (prioryear: 5.0 million euros) was charged to the DEKRA Group.
DEKRA e.V., Stuttgart, recorded revenue of the same amountfrom this source.
In addition, the DEKRA Group rendered services of
9.6 million euros (prior year: 9.9 million euros) for DEKRA e.V.,
Stuttgart, in the fiscal year.
There is a profit and loss transfer agreement in place
between DEKRA SE and DEKRA e.V., Stuttgart, as well as a tax
group for income tax and VAT purposes.

Financial Report 2017

Transactions with non - consolidated entities, associates aswell as equit y investments
Dec. 31, 2017

Dec. 31, 2016

Services rendered

4.7

3.1

Services purchased

5.1

4.1

Finance income

0.6

0.5

Receivables and loans

36.7

34.3

Liabilities*

1.6

0.7

Dec. 31, 2017

Dec. 31, 2016

S U B S I D I A R I E S T H AT A R E N OT FU L LY
CONSOLIDATEDIN MILLION EUROSASSOCIATESIN MILLION EUROS

Services rendered

0.1

0.1

Services purchased

11.2

10.0

Liabilities

0.9

0.9

Dec. 31, 2017

Dec. 31, 2016

Services rendered

0.3

0.4

Services purchased

0.8

0.2

Finance income

0.3

0.4

Receivables and loans

0.3

0.3

Liabilities*

0.0

0.1

EQUIT Y INVESTMENTS
IN MILLION EUROS* L iabilities are partially netted with the receivablesin the statement of financial position.

DEKRA

Financial Report 2017

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Notes

Notes

12 D I S C L O S U R E S O N T H E M A N A G E M E N T B O A R D A N D
SUPERVISORY BOARD

The members of the Management Board are:
• Stefan Kölbl
Chairman
Leinfelden-Echterdingen• Roland Gerdon
Stuttgart• Clemens Klinke
Boffzen• Ivo Rauh
Stuttgart

The members of the company’s Supervisory Board in the fiscal
year were:• Thomas Pleines
Chairman of the Supervisory Board
Former Chairman of the Management Board
Allianz Versicherungs-AG
President of the Presidential Board of DEKRA e.V.,
Stuttgart• Dipl.-Ing. Hartwig Meis *Deputy Chairman of the Supervisory Board
Chairman of the Central Works Council of DEKRA
Automobil GmbH and publicly appointed and sworn expert
at Münster branch of DEKRA Automobil GmbH, Stuttgart• Ulrich Beiderwieden *Formerly ver.di head office
Head of sector
Sector 13 Special Services• Prof. Dr. Sabine Fließ
Douglas Endowed Chair of Service Management
University in Hagen, Hagen• Jean-Luc Inderbitzin *Representative of the French trade union CFDTDEKRA Industrial S.A.S., Limoges, France• Dipl.-Ing. (FH) Wilfried Kettner *2nd deputy Chairman of the Central Works Council of
DEKRA Automobil GmbH, Stuttgart
Engineer at the Bad Salzungen external branch of
DEKRA Automobil GmbH, Stuttgart• Dipl.-Wirtsch.-Ing. Arndt G. Kirchhoff
Managing partner of the KIRCHHOFF Group, Iserlohn• Laurent Masquet *Deputy production manager IT
DEKRA Automotive Solutions, Bordeaux, France• Dipl.-Ing. (FH) Wilhelm Oberfranz
Head of the branch DEKRA Automobil GmbH,
Stuttgart• Monika Roth-Lehnen *Chairman of the Central Works Council of
DEKRA Akademie GmbH, Stuttgart
Project coordination and quality assurance officer at theService Center Wuppertal of DEKRA Akademie GmbH,
Stuttgart• Dipl.-Wirtsch.-Ing. Peter Tyroller
General manager
Robert Bosch GmbH, Stuttgart• Prof. Dr. Wolfgang Weiler
Former Chairman
HUK-Coburg Versicherungsgruppe

13 S U B S E Q U E N T E V E N T S

By agreement dated July 13, 2017, DEKRA acquired the land,
items and rights belonging to the Eurospeedway Lausitzring racing track. Due to conditions precedent, economic title was nottransferred to DEKRA until after the reporting date. Accordingly, the obligations outstanding as of the reporting date arereported as other financial obligations (note 8.1).
There were no significant events after the reporting date.
14 O T H E R D I S C L O S U R E S

List of shareholdings and consolidated group

The Group’s entire shareholdings pursuant to Sec. 313 (2) HGB
as well as all of the entities included in the consolidated financial
statements in addition to DEKRA SE are presented in the following list.

* Employee

DEKRA

Financial Report 2017

DEKRA

Financial Report 2017

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Notes

Notes

Share of capitalIN %Affiliates in Germany:

85

Share of capitalIN %Affiliates in other countries:

DEKRA Automobil GmbH, Stuttgart

4)

100.00DEKRA Automotive Solutions S.A.S.U., Bordeaux, France

100.00DEKRA Akademie GmbH, Stuttgart

4)

100.00DEKRA Foncier S.N.C., Trappes, France

100.00DEKRA Arbeit GmbH, Stuttgart

4)

100.00Auto Bilan France S.A.S.U., Trappes, France

100.00DEKRA Qualification GmbH, Stuttgart

4)

100.00DEKRA Automotive S.A.S. (formerly: DEKRA Automotive S.A.), Trappes, France

100.00DEKRA Certification GmbH, Stuttgart

4)

100.00C.T.A. S.A.R.L., Trappes, France

90.00

DEKRA Personal GmbH, Stuttgart

4)

100.00DEKRA Automotive Maroc S.A., Casablanca, Morocco

80.00

DEKRA Claims Services GmbH, Stuttgart

4)

100.00DEKRA Test Center S.A., Montredon des Corbières, France

100.00DEKRA Beteiligungs- und Finanzierungs GmbH, Stuttgart

4)

100.00DEKRA Expertise S.A.S., Cormelles le Royal, France

100.00DEKRA Assurance Services GmbH, Stuttgart

4)

100.00DEKRA Service Maroc S.A., Casablanca, Morocco

DEKRA Media GmbH, Mönchengladbach

1)100.00DEKRA Certification Tanúsító és Szolgáltató Kft., Budapest, Hungary

DEKRA Personaldienste GmbH, Stuttgart

4)

100.00DEKRA Certification (Proprietary) Ltd., Centurion, South Africa

100.00DEKRA Event & Logistic Services GmbH, Stuttgart

4)

100.00DEKRA CZ a.s., Prague, Czech Republic

100.00DEKRA EXAM GmbH, Bochum

4)

100.00DEKRA POLSKA Sp. z o.o., Warsaw, Poland

100.00PRO-LOG Beteiligungs GmbH, Stuttgart

100.00DEKRA Services S.A., (formerly: DEKRA Claims Services Spain, S.A.), Barcelona, Spain

PRO-LOG Ruhr GmbH, Bochum

100.00DEKRA Claims Services Luxembourg S.A., Luxembourg, Luxembourg

100.00DEKRA Claims Services Netherlands B.V., Rotterdam, Netherlands

100.00100.00DEKRA Claims Services UK Ltd., London, UK

100.00100.00DEKRA France S.A.S., Bagneux, France

100.00100.00DEKRA Belgium N.V. (formerly: DEKRA Claims and Expert Services International N.V.), Zaventem, Belgium

100.00100.00DEKRA Certification S.L., Barcelona, Spain

100.00DEKRA Certification Sp. z o.o., Wroclaw (Breslau), Poland

100.00PRO-LOG Personal GmbH, Stuttgart
DEKRA Immobilien GmbH, Stuttgart

4)

PRO-LOG IV GmbH, Stuttgart
DEKRA Industrial International GmbH, Stuttgart

4)

UPDOWN Ingenieurteam für Fördertechnik GmbH, Hamburg
GKK Gutachten GmbH, Düsseldorf

4)

DEKRA Inspection Services GmbH, Stuttgart

80.00
1)

92.00

100.001)

1)

100.00100.00100.00DEKRA Automotive North America, Inc., Marietta, USA

100.00DEKRA Automotive Solutions Germany GmbH, Frankfurt am Main

4)

100.00DEKRA Portugal S.A., Lisbon, Portugal

100.00DEKRA INCOS GmbH, Ingolstadt

4)

100.00DEKRA North America, Inc., Marietta, USA

DEKRA Cargo & Security Services GmbH (CSS), Stuttgart

1)

100.00DEKRA Austria Automotive GmbH, Vienna, Austria

100.00DEKRA zaposljavanje i zastupanje d.o.o., Zagreb, Croatia

100.00DEKRA Hellas EPE, Athens, Greece

1)100.00DEKRA Claims Services Austria GmbH, Vienna, Austria

1)100.00DEKRA Claims Services Hungary Service Ltd., Budapest, Hungary

1)

100.00DEKRA Certification S.R.L., Cluj-Napoca, Romania

1)

100.00DEKRA Visatec GmbH (formerly: Visatec Gesellschaft für visuelle Inspektionsanlagen mbH), S­ ulzberg
DEKRA Testing and Certification GmbH, Dresden

4)100.001)

100.00DEKRA Claims Services Switzerland S.A., Geneva, Switzerland

100.00DEKRA Italia S.r.l., Arese (Milan), Italy

100.00DEKRA Industrial Holding S.A.S., Limoges, France

100.00DEKRA Arbeit Magyaroszag Szolgáltató Kft., Budapest, Hungary
DEKRA Claims Services Trust reg., Vaduz, Liechtenstein
DEKRA

Financial Report 2017100.00

DEKRA

100.001)

Financial Report 2017100.0086

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

Share of capitalIN %DEKRA Zaposljavanje d.o.o., Belgrade, Serbia

1)

DEKRA za privremeno zaposljavanje d.o.o., Zagreb, Croatia
DEKRA zaposljavanje d.o.o., Sarajevo, Bosnia-Herzegovina

1)

DEKRA Certification S.A.S., Bagneux, France

87

Share of capitalIN %100.00DEKRA Sweden AB, Gothenburg, Sweden

100.00DEKRA Industrial AS, Soli, Norway

1)

100.00DEKRA Egypt for Services and Consulting, Cairo, Egypt

1)

51.00

100.00DEKRA Motores - Vistoria Veicular Ltda., Atibaia, Brazil

1)

100.00100.00100.00DEKRA Expert OOO, Kiev, Ukraine

1)

80.00

DEKRA Test Center 34 S.A.R.L., Mireval, France

100.00DEKRA Sertifikasyon A.S., Kavacık, Turkey

1)

100.00DEKRA UK Ltd., Southampton, UK

100.00DEKRA kvalifikácia a poradenstvo s.r.o., Bratislava, Slovakia

100.00Chilworth Technology Ltd., Southampton, UK

100.00DEKRA Automotive AB, Eskilstuna, Sweden

100.00Chilworth Technology (Pvt) Ltd., New Delhi, India

100.00100.00Chilworth Technology Inc., Plainsboro, USA

100.00100.00DEKRA (Shanghai) Co., Ltd., Shanghai, China
DEKRA Automotive OOD, Sofia, Bulgaria

1)

90.00

Chilworth France S.A.S., St. Jonage, France

Consorzio DEKRA Revisioni S.r.l., Arese (Milan), Italy

1)

99.00

Safety Consulting Engineers Inc., Schaumburg, USA

DEKRA Expertises Ltda., Atibaia, Brazil

1)

100.00DEKRA Personnel Ltd., Southampton, UK

DEKRA kvalifikace a poradenství s.r.o., Prague, Czech Republic

1)

100.00DEKRA ITV España S.L., Madrid, Spain

DEKRA Servicios Recursos Humano S.L., Barcelona, Spain

100.00CABINET D’EXPERTISE R.TANFERRI S.A.S., Vitry-sur-Orne, France

DEKRA Empleo ETT S.L., Barcelona, Spain

100.001)

100.00100.00100.00100.00DEKRA Arbeit Işgücü Seçme ve yerleştirme Hizmetleri Ltd., Istanbul, Turkey

1)

DEKRA Automotiv d.o.o. (formerly: DEKRA Ekspert d.o.o,) Sesvete, Croatia

1)

100.00DEKRA Arbeit Istihdam ve insan Kaynaklari Hizmeti Ltd., Istanbul, Turkey

1)

51.00

DEKRA Russ O.O.O., Moscow, Russia

1)

99.99

Centro Revisione Auto s.c.a.r.l., Genoa, Italy

1)

51.12

1)

100.00DEKRA Akademie Kft., Budapest, Hungary

51.00

100.00DEKRA Canada Inc., Saint John NB, Canada

DEKRA Hasar Servisi Ltd. Sti., Istanbul, Turkey

1)

100.00DEKRA Kalite Kontrol Hizmetleri A.S., Ankara, Turkey

100.00DEKRA Claims Services Maroc S.A.R.L., Casablanca, Morocco1)

100.00Behavioral Science Technology (BST) Inc., Oxnard, USA

100.00DEKRA Claims Services Portugal S.A., Lisbon, Portugal

100.00Behavioral Science Technology International (BSTI) Inc., Oxnard, USA

100.00DEKRA Claims and Expertise B.V., Alkmaar, Netherlands

100.00DEKRA Akademie A/S, Brondby, Denmark100.00100.00

BST Consultants Pte. Ltd., Singapore, Singapore

100.00100.00Behavioral Science Technology Consultores do Brasil Ltda., Sao Paulo, Brazil

100.00DEKRA Finland Oy, Vantaa, Finland

100.00DEKRA Services ApS, Brondby, Denmark100.00DEKRA Industrial Oy, Vantaa, Finland

100.00DEKRA AMU Center Sydjylland A/S, Vejen, Denmark100.00DEKRA Automotive Pty. Ltd., Johannesburg, South Africa

100.00DEKRA AMU Center Hovedstaden A/S, Brondby, Denmark100.00DEKRA Zaposljavanje d.o.o., Podgoriza, Montenegro

100.00DEKRA Job ApS, Brondby, Denmark100.00SLOVDEKRA s.r.o., Bratislava, Slovakia

100.00DEKRA AMU Center Nordsjaelland ApS, Ishoj, Denmark100.00100.00DEKRA AMU Center Midtjylland ApS, Skjern, Denmark100.00DEKRA Expert Limited, Stokenchurch High Wycombe, UK
DEKRA Industrial (Guangzhou) Co., Ltd., Guangzhou, China

1)

DEKRA Netherlands Holding B.V., Arnheim, Netherlands
DEKRA Claims Services, Kiev, Ukraine

70.00

DEKRA Uddannelser A/S (formerly: DEKRA Vognmandsuddannelser A/S), Braband, Denmark100.00

Checkauto Consultatoria Tecnica E Informacoes veiculares Ltda., Atibaia, Brazil

100.00Grøn Køreteknisk Anlæg A/S (formerly: DEKRA Equipment & Services A/S), Orbaek, Denmark100.00DEKRA Vistorias e Serviços Ltda., Atibaia, Brazil

100.00DEKRA Praca Sp. z o.o., Krakow, Poland

1)

100.00DEKRA South Africa Pty. Ltd. (formerly: DEKRA Automotive Holding Pty. Ltd.), Johannesburg, South Africa

100.00DEKRA Caribbean B.V., Willemstad, Curaçao

1)

100.00Hangzhou DEKRA WIT Certification Co., Ltd., Hangzhou, China

60.00

DEKRA Management (Shanghai) Co., Ltd., Shanghai, China

DEKRA Industrial AB, Gothenburg, Sweden

100.00Road Safety Consulting N.V., Brussels, Belgium

1)

DEKRA

Financial Report 2017100.001)

DEKRA

Financial Report 2017

50.10

88

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

Share of capitalIN %DEKRA Outsourcing d.o.o., Belgrade, Serbia

89

Share of capitalIN %100.00100.00DEKRA AQS Solutions, Inc., Minneapolis, USA

DEKRA People B.V., Alkmaar, Netherlands

100.00DTS Service Aps., Odense, Denmark

DEKRA Privremeno Zaposljavanje Podgorica d.o.o., Podgorica, Montenegro

100.00DEKRA iST Reliability Services Inc., Hsinchu, Taiwan

51.00

1)

1)

100.00100.00DEKRA iST Reliability Services Limited, Hong Kong, Hong Kong

51.00

DEKRA usluge d.o.o., Zagreb, Croatia

1)

100.00DEKRA iST Reliability Services Limited, Kunshan, China

51.00

DEKRA Revisión Técnica SpA, Santiago de Chile, Chile1)

100.00Optimus Seventh Generation Holding Ltd., Aberdeen, Scotland

100.00DEKRA Services (PTY) Ltd., Vereeniging, South Africa

100.00DEKRA Organisational Reliability Ltd. (formerly: Optimus Seventh Generation Ltd.), Aberdeen, Scotland

100.00DEKRA Industrial RSA (Pty) Ltd., Vereeniging, South Africa

100.00DEKRA Testing and Certification, S.A.U. (formerly: AT4 wireless S.A.U.), Malaga, Spain

100.00100.00DEKRA Insight Australia Pty Ltd., South Melbourne, Australia

100.00DEKRA Testing and Certification Inc., (formerly: AT4 wireless Inc.), Herndon, USA

DEKRA Inspecoes Portugal - Unipessoal LDT, Lisbon, Portugal

1)

100.00DEKRA Testing and Certification Ltda., (formerly: AT4 wireless Ltda.), Santiago de Chile, Chile

DEKRA Vrabotuvanje dooel, Skopje, Macedonia

1)

100.00100.00DEKRA Quality Management AB, Frösön, Sweden

99.90

DEKRA Akademie sh.p.K, Tirana, Albania

1)100.00DEKRA Arbeit (Schweiz) AG, Oftringen, Switzerland

1)

100.0050.10

DEKRA Inspection Oy, Vantaa, Finland1)

100.00DEKRA New Zealand Ltd., Wellington, New Zealand

60.00

DEKRA AMU Center Nordjylland A/S (formerly: Grons Transport Uddannelser A/S), Saeby, Denmark100.00

Vehicle Testing New Zealand Ltd. (VTNZ), Wellington, New Zealand

60.00

DEKRA Services France SAS, Bagneux, France

100.00DEKRA AMU Center Fyn ApS, Odense, Denmark
European Road Stars Academy (ERSA) SPRL, Brussels, Belgium

1)

D Akademie S.r.l., Verona, Italy

1)

80.00

DEKRA Automotive S.à r.l., Munsbach, Luxembourg

DEKRA Akademie SRL, Bucharest, Romania

1)

100.00QC Plzeň s.r.o., Plzeň, Czech Republic

Spearhead Communications Ltd., Stokenchurch, UK

100.00DEKRA Automotive Ltd., Stokenchurch, UK

100.001)

100.0082.00

DEKRA Services s.r.o., Bratislava, Slovakia

1)

100.00PRO-LOG CG d.o.o., Podgorica, Montenegro

1)

100.00100.00DEKRA Automotive d.o.o., Belgrade, Serbia

1)100.00100.00DEKRA AMU Center Sjaelland A/S, Naestved, Denmark

DEKRA Automotive La Reunion S.A.S., Sainte-Clotilde, France

100.00DEKRA Rail B.V., Utrecht, Netherlands

100.00DEKRA España S.L., Madrid, Spain
DEKRA Akademie EPE, Thessaloniki, Greece

1)

DEKRA agencija d.o.o., Sarajevo, Bosnia-Herzegovina

1)

100.00DEKRA Lesotho (Pty) Ltd., Lesotho, South Africa

1)100.00Centre Control Securite S.A.S., Tinqueux, France

1)

100.00100.00LIBOLT S.A.S., Auxerre, France

1)

100.00100.00VEIKI-VNL Villamos Nagylaboratóriumok Korlátolt Felelősségü Társaság, Budapest, Hungary

Arbeit De Agency for Temporary Employment, Skopje, Macedonia

1)

100.00DEKRA zaposlitev d.o.o., Ljubljana, Slovenia

1)

100.00

ADA 1214 DEKRA s.r.o., Prague, Czech Republic

Regulatory Consultants, Inc. Safety, Horton, USA

100.00TATRA TRUCK s.r.o.,Krásny Brod, Slovakia

1)

100.00DELTA-TECH, Fourques, France

1)

100.00100.00Master Test Chile SpA., Santiago de Chile, Chile1)

100.00DEKRA OMAN LLC, Muscat, Oman

70.00

Master Test – Inspeção de Veículos, S.A. (formerly: Master Test Sul - Inspecçāo de Veiculos S.A.), Évora, Portugal

UAB DEKRA Industrial, Visaginas, Lithuania

100.00100.00Core Visual Inspection Services, Inc., Austin, USA

1)

COMENIUS Oktató és Kiadó Kft., Pecs, Hungary

1)

100.00D. Invest S.r.l., Cinisello Balsamo, Italy1)

100.00Comenius Szakközépiskola és Szakiskola, Pecs, Hungary

1)

100.00Epoche & Espri S.L.U., Madrid, Spain1)

100.00DEKRA Testing and Certification Co., Ltd. (formerly: QuieTek Corporation), New Taipei City, Taiwan

100.00Transteam Personal Holding AG, Mels, Switzerland

1)

100.00DEKRA Testing & Certification (Suzhou) Co., Ltd., Suzhou, China

100.00TP Handels- und Dienstleistungs AG, Mels, Switzerland

1)

100.00QTK Asia Electronics, Road Town (Tortola), British Virgin Islands

100.00Transteam Personal AG Wil, Wil, Switzerland

1)

99.00

100.00Transteam Personal AG, Basel, Switzerland

1)

100.00DEKRA Middle East Fze, Dubai, United Arab Emirates
DEKRA

1)

Financial Report 2017

DEKRA

Financial Report 2017100.0090

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C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

Notes

Notes

Share of capital

IN %

91

Share of capitalIN %Transteam Personal AG, Buchs, Switzerland

1)

95.00

Associates in Germany:

Transteam Personal AG, Chur, Switzerland

1)

90.00

Euro Transport Media Verlags- und Veranstaltungsgesellschaft mbH, Stuttgart

40.00

Transteam Personal AG, Sargans, Switzerland

1)

90.00

FSD Fahrzeugsystemdaten GmbH, Dresden

35.54

TPVAG Transteam Personal Verwaltungs AG, Sargans, Switzerland

1)

100.00Group Fimmers BVBA, Kalmthout, Belgium

1)100.00

Associates in other countries:

MERMOZ BASTIE S.C.I., Limoges, France

100.00TRANSDEKRA AG, Moscow, Russia

2)

50.00

DEKRA Industrial SAS, Limoges, France

100.00DEKRA - EXPERT Müszaki Szakértöi Kft., Budapest, Hungary

2)

50.00

DEKRA Solutions (Pty) Ltd., Centurion, South Africa

100.00DEKRA Claims Services France S.A., Levallois Perret, France

2)

50.00

DEKRA Industrial S.A.R.L., Algiers, Algeria

99,50

NDT Training Center AB, Västeras, Sweden

2)

33.00

DEKRA AMBIO S.A.U., Barcelona, Spain

100.00S.T.I. Salvage Transport Incident, Arnheim, Netherlands

2)

33.00

DEKRA Inspection S.A., Casablanca, Morocco

100.00DEKRA Certification B.V., Arnheim, Netherlands

100.00Equity investments:

DEKRA Solutions B.V., Arnheim, Netherlands

100.00

ARGE „Technische Prüfstelle für den Kraftfahrzeugverkehr 21“ GbR, Dresden

3) 5)

25.00

DEKRA Testing and Certification S.r.l., Osnago, Italy

100.00Magility GmbH, Kirchheim unter Teck

3) 5)

25.00

100.00DYNAE S.A., Villefontaine, France

19.93

51.00

Société Coopérative de Promotion S.A., Trappes, France< 5.00100.00Credit Agricole S.A., Paris, France< 1.00100.00Credit Mutuel, Paris, France< 1.00DEKRA Certification Ltd., Tel Aviv, Israel

100.00

ITT Technology Transfer s.r.l., Ferrara, Italy

DEKRA Certification Hong Kong Ltd., Fanling, Hong Kong

100.00DEKRA Certification Inc., North Wales, USA

100.00DEKRA Certification K.K., Tokyo, Japan

1)

DEKRA Testing Services (Zhejiang) Ltd., Zhejiang, China
DEKRA Testing and Certification (Shanghai) Ltd., Shanghai, China
DEKRA Certification Ltd., Pershore Worcestershire, UK

1)

1.00

Not included in the consolidated financial statements by way of full consolidation.
Not accounted for using equity method due to insignificance to financial position and performance (Sec. 311 (2) HGB).
T he disclosures pursuant to Sec. 313 (2) No. 4 HGB are not made since they are insignificant to the presentation of a trueand fair view of the Group‘s financial position and performance.
4)
Utilization of the exemption pursuant to Sec. 264 (3) HGB.
5)
Significant influence is not exercised.
1)

2)

3)

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Notes

Independent auditor’s report

93

Translation of the German audit opinion concerning theaudit of the consolidated financial statements and groupmanagement repor t prepared in German.

DEKRA SE
Independent auditor’s report
Audit of the financial statements

To DEKR A SE

The shareholder meeting on April 25, 2017 appointed Ernst &Young GmbH Wirtschaftsprüfungsgesellschaft as auditors of theseparate and consolidated financial statements for fiscal year 2017.
The auditors’ fees recognized in the fiscal year are shownin the following table.

IN THOUSAND EUR

2017

2016

Audit services

840

792

Tax advisory services

183

135

1,023

927

Stuttgart, March 22, 2018
DEKRA SEThe Management Board

We have audited the consolidated financial statements of
DEKRA SE, Stuttgart, and its subsidiaries (the Group),
which comprise the consolidated statement of comprehensive
income for the fiscal year from January 1 to December 31, 2017,
the consolidated statement of financial position as ofDecember 31, 2017, the consolidated statement of changes inequity, the consolidated statement of cash flows for the fiscal year
from January 1 to December 31, 2017, and the notes to theconsolidated financial statements, including a summary ofsignificant accounting policies. In addition, we have audited thegroup management report of DEKRA SE for the fiscal year fromJanuary 1 to December 31, 2017. In accordance with German
legal requirements, we have not audited the content of the groupstatement on corporate governance in the “Disclosures on the
proportionate representation of women on executive boards”
section of the group management report.
In our opinion, on the basis of the knowledge obtained in
the audit,– the accompanying consolidated financial statements comply, inall material respects, with the IFRSs as adopted by the EU, andthe additional requirements of German commercial law
pursuant to Sec. 315e (1) HGB [“Handelsgesetzbuch”: German
Commercial Code] and, in compliance with these requirements,
give a true and fair view of the assets, liabilities, and financial
position of the Group as of December 31, 2017, and of its
financial performance for the fiscal year from January 1 to
December 31, 2017, and– the accompanying group management report as a whole provides an appropriate view of the Group’s position. In all material
respects, this group management report is consistent with theconsolidated financial statements, complies with German legal
requirements and appropriately presents the opportunities andrisks of future development. Our opinion on the group management report does not cover the content of the group statementon corporate governance contained in the “Disclosures on the
proportionate representation of women on executive boards”
section of the group management report.

Kölbl, Chairman

GerdonOpinions

Klinke

Rauh

DEKRA

Financial Report 2017

DEKRA

Pursuant to Sec. 322 (3) Sentence 1 HGB, we declare that our
audit has not led to any reservations relating to the legal compliance of the consolidated financial statements and of the groupmanagement report.
Basis for the opinions

We conducted our audit of the consolidated financial statements
and of the group management report in accordance with Sec.
317 HGB and in compliance with German Generally AcceptedStandards for Financial Statement Audits promulgated by theInstitut der Wirtschaftsprüfer [Institute of Public Auditors inGermany] (IDW). Our responsibilities under those requirements
and principles are further described in the “Auditor’s responsibilities for the audit of the consolidated financial statements andof the group management report” section of our auditor’s report.
We are independent of the group entities in accordance with therequirements of German commercial and professional law, andwe have fulfilled our other German professional responsibilities
in accordance with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinions on the consolidated financial statements and on the group management report.
Other information

The Supervisory Board is responsible for the Report of the Supervisory Board. In all other respects, the executive directors are
responsible for the other information. The other information
comprises the group statement on corporate governance contained in the “Disclosures on the proportionate representationof women on executive boards” section of the group management report. It also comprises the other components of theannual report except for the audited consolidated financial statements and group management report as well as our auditor’sreport, in particular the “Foreword of the Chairman of the Management Board” section and the “Report of the Chairman of theSupervisory Board” section. We received a version of this otherinformation by the time this auditor’s report was issued.
Our opinions on the consolidated financial statements
and on the group management report do not cover the otherinformation, and consequently we do not express an opinion
or any other form of assurance conclusion thereon.

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Independent auditor’s report

Independent auditor’s report

In connection with our audit, our responsibility is to read theother information and, in so doing, to consider whether theother information– is materially inconsistent with the consolidated financial statements, with the group management report, or our knowledge
obtained in the audit, or– otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there
is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in thisregard.
Responsibilities of the executive directors and the Super vi sor y Board for the consolidated financial statements andthe group management repor t

The executive directors are responsible for the preparation of
the consolidated financial statements that comply, in allmaterial respects, with IFRSs as adopted by the EU and the additional requirements of German commercial law pursuant toSec. 315e (1) HGB, and that the consolidated financial statements,
in compliance with these requirements, give a true and fair viewof the assets, liabilities, financial position, and financial performance of the Group. In addition, the executive directors are
responsible for such internal control as they have determined necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due tofraud or error.
In preparing the consolidated financial statements, theexecutive directors are responsible for assessing the Group’s ability to continue as a going concern. They also have the responsibility for disclosing, as applicable, matters related to going concern. In addition, they are responsible for financial reporting
based on the going concern basis of accounting unless there isan intention to liquidate the Group or to cease operations, orthere is no realistic alternative but to do so.
Furthermore, the executive directors are responsible forthe preparation of the group management report that, as a whole,provides an appropriate view of the Group’s position and is, in

DEKRA

all material respects, consistent with the consolidated financial
statements, complies with German legal requirements, andappropriately presents the opportunities and risks of future
development. In addition, the executive directors are responsible
for such arrangements and measures (systems) as they have considered necessary to enable the preparation of a group management report that is in accordance with the applicable German
legal requirements, and to be able to provide sufficient appropriate evidence for the assertions in the group management report.
The Supervisory Board is responsible for overseeing theGroup’s financial reporting process for the preperation of theconsolidated financial statementes and of the group management
report.
Auditor’s responsibilities for the audit of the consolidated
financial statements and of the group management repor t

Our objectives are to obtain reasonable assurance about whether
the consolidated financial statements as a whole are free frommaterial misstatement, whether due to fraud or error, andwhether the group management report as a whole provides anappropriate view of the Group’s position and, in all material
respects, is consistent with the consolidated financial statements
and the knowledge obtained in the audit, complies with the German legal requirements and appropriately presents the opportunities and risks of future development, as well as to issue anauditor’s report that includes our opinions on the consolidated
financial statements and on the group management report.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance with
Sec. 317 HGB and in compliance with German Generally
Accepted Standards for Financial Statement Audits promulgatedby the Institut der Wirtschaftsprüfer (IDW) will always detect amaterial misstatement. Misstatements can arise from fraud or
error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated
financial statements and this group management report.
We exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Financial Report 2017

– Identify and assess the risks of material misstatement of theconsolidated financial statements and of the group management report, whether due to fraud or error, design and perform
audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis
for our opinions. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting fromerror, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
– Obtain an understanding of internal control relevant to theaudit of the consolidated financial statements and of arrangements and measures (systems) relevant to the audit of the groupmanagement report in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of these systems.
– Evaluate the appropriateness of accounting policies used by
the executive directors and the reasonableness of estimates
made by the executive directors and related disclosures.
– Conclude on the appropriateness of the executive directors’ useof the going concern basis of accounting and, based on theaudit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt
on the Group’s ability to continue as a going concern. If weconclude that a material uncertainty exists, we are required to
draw attention in the auditor’s report to the related disclosuresin the consolidated financial statements and in the group management report or, if such disclosures are inadequate, to modify our respective opinions. Our conclusions are based on theaudit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Group tocease to be able to continue as a going concern.
– Evaluate the overall presentation, structure and content of theconsolidated financial statements, including the disclosures,and whether the consolidated financial statements present theunderlying transactions and events in a manner that the consolidated financial statements give a true and fair view of theassets, liabilities, financial position and financial performanceof the Group in compliance with IFRSs as adopted by the EU
and the additional requirements of German commercial law
pursuant to Sec. 315e (1) HGB.

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95

– Obtain sufficient appropriate audit evidence regarding thefinancial information of the entities or business activities within
the Group to express opinions on the consolidated financial
statements and on the group management report. We areresponsible for the direction, supervision and performance ofthe group audit. We remain solely responsible for our opinions.
– Evaluate the consistency of the group management report withthe consolidated financial statements, its conformity with[German] law, and the view of the Group’s position it provides.
– Perform audit procedures on the prospective information presented by the executive directors in the group management
report. On the basis of sufficient appropriate audit evidence weevaluate, in particular, the significant assumptions used by the
executive directors as a basis for the prospective information,and evaluate the proper derivation of the prospective information from these assumptions. We do not express a separate
opinion on the prospective information and on the assumptions used as a basis. There is a substantial unavoidable riskthat future events will differ materially from the prospective
information.

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Independent auditor’s report

Chairman of the Super visor y Board

97

Report by the
Chairman of the Supervisory Board

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of theaudit and significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
Stuttgart, March 23, 2018
Ernst & Young GmbH
Wirtschaftsprüfungsgesellschaft
THOMAS PLEINES

HummelWirtschaftsprüfer[German Public Auditor]

The Supervisory Board fulfilled its oversight and advisory function
for the Management Board of DEKRA SE in the reporting year 2017
in a comprehensive manner. We were regularly informed verballyand in writing about important business transactions. In addition, themain business transactions were discussed in detail at two Supervisory
Board meetings as well as at meetings and discussions between the
Chairman of the Supervisory Board and the Management Board.
The economic situation and strategic alignment of DEKRA werediscussed in the context of achieving long-term stable and healthy
corporate development.

President of the Presidential Boardof DEKRA e. V. and Chairman of theSupervisory Board of DEKRA SE.

The Supervisory Board determined that 2017 was yet anothersuccessful year for DEKRA SE. The key business indicators such as
revenue and result improved. The number of employees worldwide increased by over
4,000 to more than 44,000.

Fischer
Wirtschaftsprüferin[German Public Auditor]

The Supervisory Board appointed Ernst & Young GmbH, Wirtschaftsprüfungsgesell­schaft, Stuttgart, as auditors for the annual financial statements and management
report as well as for the consolidated financial statements and consolidated management report of DEKRA SE together with the accounting system for the 2017 financial
year. The Supervisory Board duly notes and concurs with the unqualified audit opinion of the auditor. The Supervisory Board’s own review raised no objections to theannual financial statements, management report, consolidated financial statements
and con­solidated management report. The annual financial statements compiled by
the Management Board are endorsed by the Supervisory Board and are therefore
finalized.
The Supervisory Board would like to thank the Management Board for its successful
work during the reporting year. We wish to thank all employees for their commitment
to DEKRA.
Stuttgart, April, 2018
The Supervisory Board

THOMAS PLEINES,

Chairman

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Imprint

DEKR A e.V.
Communications and Brand Mangament
Handwerkstrasse 1570565 Stuttgar t
Phone +49.711.7861–2876
Fax +49.711.7861–2912

CONCEPT AND DESIGN

Strichpunkt GmbH
Stuttgar t/Berlin
PHOTOGRAPHY

Sebastian Vollmer t, Hamburg

DEKRA

Financial Report 2017

DEKRA SE
Handwerkstrasse 1570565 Stuttgart
Phone +49.711.7861–0
Fax +49.711.7861–2912

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