New Accounting Standards

Amendments to IFRS 7

Disclosure Requirements Relating to Transfers of Financial Assets

July 1, 2011

Nov. 22, 2011

The changes to IFRS 7 apply to additional disclosure obligations relating to the transfers of financial assets. This serves to simplify the relationship between financial assets that are not to be derecognized completely and the corresponding financial liabilities. In the absence of relevant circumstances, the revised standard had no impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements.

Amendments to IFRS 1 for First-Time Adopters

Severe Hyper-Inflation and Removal of Fixed Dates

July 1, 2011

Dec. 11, 2012

The amendment replaces the existing references to the date of January 1, 2004, with a reference to the timing of the transition to IFRS. This amendment also includes rules for those cases in which hyperinflation makes it impossible for an entity to comply with all IFRS stipulations. Its application has no impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements.

Amendments to IAS 12

Deferred Tax: Recovery of Underlying Assets

Jan. 1, 2012

Dec. 11, 2012

The amendment contains a partial clarification of the treatment of temporary taxable differences from IAS 40’s fair value model. Investment property often makes it difficult to assess whether existing differences are recovered as part of continuing use or in the wake of a sale. The amendment therefore generally makes it necessary to presume recovery due to a sale. Its application has no substantial impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements. WACKER measures its investment property exclusively at amortized cost.

Amendments to IAS 1

Presentation of Items of Other Comprehensive Income

July 1, 2012

June 5, 2012

The application of the revised standard will have no impact on WACKER’s earnings, net assets and financial position. The presentation in WACKER’s financial statements of items of other comprehensive income will be enhanced.

Amendments to IAS 19

Employee Benefits

Jan. 1, 2013

June 5, 2012

The amendments to IAS 19 will affect the recognition and measurement of the expense for defined benefit pension plans and termination benefits. They will also result in wider disclosure requirements regarding employee benefits. The option of accounting for actuarial gains and losses using the corridor method is eliminated. In the future, these impacts will be recognized immediately in “other comprehensive income.” Additionally, the return on plan assets is no longer to be recognized based on the expected interest rate but on the discount rate. Since WACKER is currently using the corridor method, the change applied as of January 1, 2013 is expected to result in an increase in provisions for pensions of around €680 million and a reduction in Group equity of around €490 million. Such recognition within other comprehensive income of variations in actuarial gains and losses will lead to more volatility in equity in the future.

IFRS 10

Consolidated Financial Statements

Jan. 1, 2014

Dec. 11, 2012

IFRS 10 changes the definition of “control” so that the same criteria are applied to all companies in determining control. The standard replaces the consolidation guidelines in the previous IAS 27 and SIC 12. The new rules may lead to major changes in the scope of consolidation compared with the previous determination of the Group pursuant to IAS 27. WACKER is currently of the opinion that application of the revised standard will have no influence on the current determination of the scope of consolidation.

IFRS 11

Joint Arrangements

Jan. 1, 2014

Dec. 11, 2012

IFRS 11 regulates the accounting of arrangements where a company exercises joint control over a joint venture or a joint operation. The standard replaces IAS 31. In the future, joint ventures will be accounted for using exclusively the equity method. The option of proportionate consolidation has been abolished. The abolition of proportionate consolidation has no impact on WACKER’s earnings, net assets and financial position because WACKER already accounts for joint ventures using the equity method. At the moment, WACKER cannot conclusively assess the other effects of IFRS 11, including in respect of joint operations.

IFRS 12

Disclosure of Interests in Other Entities

Jan. 1, 2014

Dec. 11, 2012

IFRS 12 regulates the disclosures in the consolidated financial statements that enable users to assess the nature of, risks associated with and financial consequences of the entity’s involvement in subsidiaries, associates, joint arrangements and unconsolidated structured entities. Application of the revised standard will lead to a substantial broadening of the disclosures in WACKER’s consolidated financial statements.

IFRS 13

Fair Value Measurement

Jan. 1, 2013

Dec. 11, 2012

IFRS 13 describes how fair value is to be measured and extends the disclosures on fair value. Application of the new method of determining fair value will be relevant to all areas of WACKER’s consolidated financial statements in which fair values are determined. WACKER does not expect the new approach to have any substantial impact on its earnings, net assets and financial position. The disclosure obligations in the consolidated financial statements will increase.

IAS 27

Separate Financial Statements

Jan. 1, 2014

Dec. 11, 2012

In the future, IAS 27 will deal only with separate financial statements. The existing guidelines for separate financial statements remain unchanged. The application of the revised standard will have no impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements.

IAS 28

Investments in Associates

Jan. 1, 2014

Dec. 11, 2012

IAS 28 now also regulates the accounting of joint ventures using the equity method. The application of the revised standard will have no substantial impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements.

IFRIC 20

Stripping Costs in the Production Phase of a Surface Mine

Jan. 1, 2013

Dec. 11, 2012

IFRIC 20 regulates the accounting treatment of the cost of removing waste from a surface mine. In the absence of relevant circumstances, the interpretation has no impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements.

Amendments to IAS 32

Offsetting Financial Assets and Financial Liabilities

Jan. 1, 2014

Dec. 13, 2012

This amendment to IAS 32 clarifies requirements for offsetting of financial instruments. Application of the revised standard will have no substantial impact on WACKER’s earnings, net assets and financial position.

Amendments to IFRS 7

Offsetting Financial Assets and Financial Liabilities

Jan. 1, 2013

Dec. 13, 2012

These amendments to IFRS 7 extend the disclosure requirements regarding the netting of financial assets and financial liabilities. The added disclosure requirements will have an impact on the presentation of the financial statements.

IFRS 9

Financial Instruments

Nov. 12, 2009

Jan. 1, 2015

Postponed

In the future, financial assets will be measured either at amortized cost or at fair value, depending on the business model of the company in question. At the moment, WACKER cannot conclusively assess what impacts the first-time application of this standard will have, should it be endorsed by the EU in its current form.

Amendments to IFRS 9 and IFRS 7

Mandatory Effective Date of IFRS 9 and Transition Disclosures

Dec. 16, 2011

Jan. 1, 2015

Postponed

The amendments postpone the effective date of IFRS 9 and provide for additional disclosure requirements. Because WACKER cannot yet assess what impacts the first-time application of IFRS 9 will have, it is also not yet possible to evaluate the potential impact of these amendments to IFRS 9 and IFRS 7.

Amendments to IFRS 1 for First-Time Adopters

Government Loans

March 13, 2012

Jan. 1, 2013

Expected in Q1 2013

This change provides first-time IFRS adopters with the same relief in terms of the accounting of government loans as for existing adopters. Its application will have no impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements.

Improvements to IFRS 
(2009–2011)

May 17, 2012:

Jan. 1, 2013

Expected in Q1 2013

Amendments affect IFRS 1, IAS 1, IAS 16, IAS 32 and IAS 34; the changes have no impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements.

Amendments to IFRS 10, IFRS 11 and IFRS 12

Transition Guidelines

June 28, 2012

Jan. 1, 2013¹

Expected in Q1 2013

The purpose of the amendments is to clarify the transition guidelines in IFRS 10. Additionally, the changes facilitate the transition to IFRS 10, IFRS 11 and IFRS 12. Application of the changes will have no impact on WACKER's earnings, net assets and financial position, or on the presentation of its financial statements.

Amendments to IFRS 10, IFRS 12 and IAS 27

Investment Entity

Oct. 31, 2012

Jan. 1, 2014

Expected in Q3 2013

The changes primarily focus on redefinition of the term “investment entity.” Investment entities are also not required to fully consolidate majority-controlled subsidiaries in their consolidated financial statements. The amendments have no impact on WACKER’s earnings, net assets and financial position, or on the presentation of its financial statements.