C. Scope of consolidation

The consolidated Group (see the “Investments” appendix to the Notes) is defined in accordance with IFRS requirements. In addition to the annual financial statements of voestalpine AG, the Consolidated Financial Statements also include the financial statements of entities controlled by voestalpine AG (and its subsidiaries). Entities controlled by voestalpine AG that are not included in the Consolidated Financial Statements of voestalpine AG are negligible, both individually and collectively.

Subsidiaries are entities controlled by the Group. Control exists when the voestalpine Group has power over the investee, is exposed to fluctuating returns on its investment, and has the ability to use its power over the investee to affect the amount of the investor`s returns. The annual financial statements of subsidiaries are included in the Consolidated Financial Statements as of the point in time at which the Group acquires control over the subsidiary up to the point in time at which the Group ceases to exercise control over the subsidiary.

Associates are entities over which the voestalpine Group has significant influence, because it participates in the entities’ financial and operating policy decisions, but the decision-making processes are not controlled nor jointly managed. Joint ventures are joint arrangements in which partner companies (the voestalpine Group and one or more partners) exercise joint control over the arrangement and possess rights to the entity’s net assets. The annual financial statements of associates and joint ventures are included in the Consolidated Financial Statements using the equity method from the acquisition date until the disposal date. The Group’s associates and joint ventures are listed in the “Investments” appendix to the Notes.

Changes in the scope of consolidation

The scope of consolidation changed as follows during the past business year:

The following entities were deconsolidated during the business year 2019/20:

All shares were sold and deconsolidated as of the close of the past business year in connection with the dissolution of the securities fund of funds, V54. Its effects on the Consolidated Financial Statements are deemed immaterial.

The sale of the Mexican subsidiary of voestalpine Precision Strip, Compania de Industria y Comercio, S.A. de C.V., was completed on February 12, 2020. Sales of special steel for special applications in the Mexican market are the company’s core business. The sale is rooted in the voestalpine Group’s consistent pursuit of its strategic orientation on processed products. The aforementioned Mexican company generated revenue of around EUR 3.6 million in the business year 2018/19 and has 19 employees.

The disposal had the following effect on the Consolidated Financial Statements: