Note 40 Other financial assets 

The movement in deferred tax assets is explained by the application of the tax scheme for discretionary depreciation for tax purposes. For further disclosures, reference is made to note 17.

In June 2015, Alliander granted a long-term loan of €2,566 million to Liander, along with other lending. This amount was deducted from the current account in 2015. This means that there are two separate financing arrangements between Alliander and Liander, namely a long-term loan agreement, essentially for the purpose of financing network replacement and expansion investments, as well as the existing, separate current account agreement to finance working capital. This provides a closer match between the time horizons of the financing arrangements and the useful lives of the corresponding assets.

The long-term loan agreement with Liander runs for 10 years with automatic annual renewal thereafter for a period of one year on each occasion. The interest rate in 2023 was 1.9% (2022: 1.3%). The interest rate is based on the average cost of borrowing on Alliander’s lending portfolio, with a risk markup. The interest rate will be reviewed annually. The principal will be repayable at the latest on the conclusion of the arrangement. At year-end 2023, the fair value was €2,518 million (2022: €2,421 million).