BASF Report 2021 Consoli dated Financial Statements – Notes 254 Other liabilities 22 Provisions for pensions and similar obligations Million € December 31, 2021 December 31, 2020 Accounting policies Noncurrent Current Noncurrent Current Derivatives with negative fair values 131 438 284 674 In addition to state pension plans, most employees are granted Liabilities from leases 1,078 334 1,026 334 company pension benefits from either defined contribution or Loan and interest liabilities 35 505 37 583 defined benefit plans. Benefits generally depend on years of service, Advances received on orders – 949 – 679 contributions or compensation, and take into consideration the legal framework of labor, tax and social security laws of the countries Miscellaneous liabilities 26 753 41 464 where the companies are located. To limit the risks of changing Other liabilities that qualify as financial instruments 1,270 2,978 1,388 2,734 financial market conditions as well as demographic developments, Liabilities related to social security 63 79 55 76 employees have, for a number of years now, been almost exclusively Employee liabilities 22 294 22 238 offered defined contribution plans for future years of service. Liabilities from precious metal trading positions – 201 – 200 Contract liabilities 201 40 210 52 The Group Pension Committee monitors the risks of all pension plans of the Group with regard to the financing of pension Deferred income 17 32 7 26 commitments and the portfolio structure of existing plan assets. The Miscellaneous liabilities 28 56 29 114 organization, responsibilities, strategy, implementation and reporting Other liabilities that do not qualify as financial instruments 330 701 323 706 requirements are documented for the units involved. Other liabilities 1,600 3,679 1,711 3,440 The accounting policies presented in the following relate to defined benefit pension obligations. Other liabilities Carrying amounts of assets used to secure liabilities Million € Provisions for pensions are calculated on an actuarial basis in Contract liabilities include mainly customer payments entitling Dec. 31, Dec. 31, accordance with the projected unit credit method. Assumptions 2021 2020 them to access licenses over an agreed period of time. The majority To secure relating to the following valuation parameters, among others are of existing contracts have terms of up to six years. Of the contract used: future developments in compensation, pensions and inflation, liabilities reported as of December 31, 2021, €40 million are liabilities to credit institutions 64 13 employee turnover, and the life expectancy of beneficiaries. expected to be recognized as revenue in 2022. accounts payable, trade 11 2 Obligations are discounted based on the market yields on high- For more information on financial risks and derivative instruments, see Note 26 from page 263 onward other liabilities 170 264 quality corporate fixed-rate bonds. For more information on liabilities arising from leases, see Note 16 from page 244 onward Carrying amounts of assets used 245 279 Similar obligations, especially those arising from commitments by Liabilities to credit institutions were secured primarily with North American Group companies to pay the healthcare costs and registered land charges. Secured other liabilities relate primarily to life insurance premiums of retired staff and their dependents, are derivatives with negative fair values that are secured with other reported under provisions for similar obligations. receivables and miscellaneous assets.