DGAP-Adhoc

K+S Aktiengesellschaft: Final FREP findings do not result in adjustments to valuations - Seite 2

There is a breach of IAS 1.122 and IAS 1.125, according to which the discretionary decisions associated with the accounting methods applied, as well as significant assumptions and estimation uncertainties, must be disclosed in the notes to the consolidated financial statements. In addition, IAS 1.31 in conjunction with IAS 36.132 also require an entity to consider additional disclosures if the effects of events and conditions on the financial position would otherwise not be understandable to the readers of the financial statements.

With regard to the abbreviated consolidated financial statements as of June 30, 2020, the DPR's findings are:

1. No impairment test was carried out for the interim financial statements of K+S AG as of 30 June 2020 for the net book value of the Potash and Magnesium Products cash-generating unit (in the amount of 5,196.8 million euros, 51.7% of the consolidated balance sheet total), although there were indications that the net assets could be impaired. Indications were in particular the negative potash price development and the further decline in market capitalization below the net assets of the Company. The failure to carry out an impairment test violates IAS 36.9 in conjunction with IAS 36.12 and IAS 34.28.
2. In the interim management report of K+S AG for H1/2020, material events and their effects on the financial position and its development were not presented with sufficient clarity. In particular, it is not reflected that the free cash flow of €166.2 million generated in the first half of 2020 is fully attributable to non-operational measures, mainly to factoring introduced in 2020 as a working capital management measure. This is in breach of Section 115 (4) of the German Securities Trading Act (WpHG) in conjunction with GAS 16.40 et seq. (e.g. GAS 16.41, internal events g)).

K+S has been requested by the DPR to indicate whether the Company agrees or disagrees with the findings by December 9, 2021. By agreeing, the proceedings would be terminated.


Contact:
Investor Relations:
Julia Bock, CFA
Phone: [phone]
[e-mail]

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25-Nov-2021 CET/CEST The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.