History Note 25

Notes to the Consolidated Financial Statements

1. Basic information and principles of the report

2. Changes in Group structure

3. Summary of significant accounting policies

4. Risk assessment and management

5. Management of capital

6. Trade accounts receivable

7. Other current assets and current financial assets

8. Inventories

9. Property, plant and equipment

10. Other non-current assets and non-current financial assets

11. Goodwill and intangible assets

12. Short-term debt

13. Other current liabilities and provisions

14. Long-term debt

15. Financial instruments

16. Retirement benefit plans

17. Participation plans

18. Deferred tax assets and liabilities

19. Other non-current liabilities and provisions

20. Contingencies

21. Capital stock and treasury shares

22. Earnings per share

23. Other operating expenses, net

24. Financial result, net

25. Income tax expenses

  2017 2016
Current taxes 101.4 117.3
Deferred taxes -16.5 -34.7
Total income tax expenses 84.9 82.6

The differences between income tax expenses computed at the weighted-average applicable tax rate of the Group of 12.5% (PY: 14.6%) and the effective income tax expenses were as follows:

  2017 2016
Income tax expenses, at applicable rate 76.8 91.8
Operating losses with no current tax benefit 13.9 3.1
Offsetting of current profits against loss carryforwards without tax assets -1.3 -6.1
Changes in future tax rates -0.7 -0.4
Non-deductible expenses and non-taxable income, net 0.4 0.8
Other -4.2 -6.6
Total income tax expenses 84.9 82.6

The reduction of the weighted-average applicable tax rate of the Group by -210 bp mainly results from the MCHF 45 restructuring costs in France, which are considered as deductible for the calculation of the theoretical tax rate, but also from an improved country mix.

In 2017 the position “Other” includes mainly tax benefits from the capitalisation of loss carryforwards which occurred from reorganisation projects. The position “Operating losses with no current tax benefit” mainly includes the non-capitalisable loss in France which resulted from the aforementioned restructuring costs.

26. Operating Leasing

27. Research and development cost

28. Cashflow figures

29. Segment reporting

30. Related party transactions

31. Foreign exchange rates

32. Subsequent events

33. Group companies as at 31 December 2017