■ 4.8 Provisions
Accounting principles A provision is recognised when, as a result of an earlier event, the Group has a legal or actual obligation, the realisation of a payment obligation is likely, and the amount of the obligation can be reliably estimated. Any reimbursement from a third party is presented as an asset separate from the provision if it is practically certain that reimbursement will be received. Restructuring A restructuring provision is recorded when the Group has incurred a legal or constructive obligation to make a payment. Termination payments are recorded when a detailed plan has been made for the restructuring and the Group has raised valid expectations in those affected that it will carry out the restructuring by starting to implement that plan or announcing its main features to those affected by it. If the Group makes an offer to employees concerning voluntary resignation against benefits determined in the offer, the liability arising from this is recorded when the Group can no longer withdraw its offer. The obligation arising from such an offer is based on the number of employees that the Group expects to accept the offer. Benefits falling due in twelve months’ time or later are measured at their present value.
Environmental obligations Costs arising from environmental remediation that do not increase present or future revenue are recorded as expenses. An environmen- tal obligation is recognised if, based on the current interpretation of environmental legislation, an obligation has likely arisen and its amount can be reliably estimated. The obligation is recorded at the current value of estimated future expenses. A sum corresponding to the obligation is also recognised in property, plant and equipment. Other provisions Other provisions mainly consist of provisions arising from estimated cost of future restoration of leased sites. Key estimates and judgements The determination of the criteria for the recognition of provisions involves the management’s judgement. The amounts recognised as provisions are based on the management’s best assessment of the expenses required to handle the obligation. As the timing and amount of these expenses are not fully certain, the actual expenses may differ significantly from the original estimate. The book value of provisions is regularly reviewed and adjusted as required, taking into account changes in cost assessments, regulation, technology and conditions.
1 Jan 2022
0.2 0.0 4.9
3.0 0.0 4.9 -0.7 -0.3
Utilised during the year Unused amounts reversed
-0.7 -0.1 2.0
31 Dec 2022
2.0 4.9 6.9
1 Jan 2021
4.7 0.0 0.0 -0.7 0.0 -1.0 3.0
Utilised during the year Unused amounts reversed Transfers to assets held for sale
31 Dec 2021
2.0 0.8 2.7
0.0 0.0 0.0
2.0 1.0 3.0
Half of non-current provisions are estimated to be utilised by the end of 2025 and the rest in 2030s. The increases in provisions in 2022 are related to the reorganiza-tion of customer service and supply chain management. The Group companies have environmental responsibilities related to former industrial activities at sites that have since been closed, sold or leased, and from decommissioned landfill sites. Provisions for the costs of land rehabilitation work have been made in cases where it has been possible to measure the
Group’s liability for land contamination and any post-treatment obligations. In 2021 assets held for sale include Oy Hangö Stevedoring Ab’s assets.
Consolidated financial statements | METSÄ BOARD ANNUAL AND SUSTAINABILITY REPORT 2022
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