[5] Financial instruments

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Financial assets and liabilities measured at fair value



















in € million


Level 1


Level 2


Level 3


Level 1


Level 2


Level 3

Investments and securities













Derivatives with positive fair values













Derivatives with negative fair values













For individual categories of financial assets and financial liabilities in The Linde Group, the carrying amount of the item is generally a reasonable approximation of the fair value of the item. This does not apply to receivables from finance leases or to financial debt. In the case of receivables from finance leases, the fair value is EUR 315 m, while the carrying amount is EUR 247 m. The fair value of the financial debt is EUR 9.691 bn, compared with its carrying amount of EUR 9.170 bn. The fair value of financial iinstruments is generally determined using quoted market prices. If no quoted market prices are available, the financial instruments are measured using valuation methods customary in the market. The investments and securities category also included financial assets (available-for-sale financial assets) of EUR 15 m (2015: EUR 15 m) for which a fair value cannot be reliably determined. For these assets, there are neither observable market prices nor sufficient information for a reliable valuation using other valuation methods. There is currently no intention to sell these assets.

For derivative financial instruments, the fair value is determined as follows. Options are measured by external partners using Black-Scholes pricing models. Futures are measured with recourse to the quoted market price in the relevant market.

All other derivative financial instruments are measured by discounting future cash flows using the present value method. The starting parameters for these models should, as far as possible, be the relevant observable market prices and interest rates at the balance sheet date, obtained from recognised external sources.

At the balance sheet date, no assets or liabilities had been recognised for which the values had been determined by valuation techniques with principal inputs not derived from observable market data (Level 3). During the reporting period, there were no transfers between Levels 1, 2 and 3 of the fair value hierarchy.