SCH2017_DRF_EN_Livre.indb

5 Consolidated financial statements at December 31, 2017 Notes to the consolidated financial statements

(c) Product risks These provisions are primarily established to cover risks arising from products sold to third parties. This risk consists of claims based on alleged product defects and product liability. These provisions comprise: E statistical provisions for warranties: the Group funds provisions on a statistical basis for the residual cost of Schneider Electric product warranties not covered by insurance; E provisions for disputes over defective products; E provisions to cover disputes related to recalls of clearly identified products.

(d) Environmental risks These provisions are primarily funded to cover cleanup costs. Other risks These provisions cover, in particular, insurance risks associated with the Group’s captive insurance companies, certain historical legal risks, and certain provisions relating to employees, along with miscellaneous other risks. (e)

(f)

Reconciliation with cash flow

statement The increase and decrease in provisions retreated at statutory cash flow were as follows:

Dec. 31, 2017

Dec. 31, 2016

Increase of provision Utilization of provision

507

601

(478)

(506) (170)

Reversal of surplus provision

(80) (51)

Provision variance including tax provisions but excluding employee benefit obligation

(75) (61)

(Tax provisions net variance)

28

Provision variance excluding tax provisions and pension benefit obligation Employee benefit obligation net variance excluding contribution to plan assets

(23) (46) (69)

(136)

24

Increase/(decrease) in provisions in cash-flow statement

(112)

Total current and non-current financial liabilities

NOTE 24

Non-current financial liabilities break down as follows:

Dec. 31, 2017

Dec. 31, 2016

Bonds

6,375

6,746

Bank and other borrowings

23

240

Lease liabilities

-

1 5

Employee profit sharing

4

Short-term portion of convertible and non-convertible bonds

(749)

(1,025) (201) 5,766

Short-term portion of long-term debt

(3)

NON-CURRENT FINANCIAL LIABILITIES

5,650

2017 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC

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