GROUP MANAGEMENT REPORT Furthermore, additional action was taken to ensure mitigation measures such as introducing upfront payments or changing payment terms. Borussia liquidity and counter any potential bad debts. Dortmund is also in close contact with its customers and partners and its sponsoring marketing firm Borussia Dortmund places utmost importance on SPORTFIVE Germany GmbH, and is maintaining a maintaining its liquidity and, after assessing its risks close and trusting relationship with them. This is also during the ongoing COVID-19 pandemic, therefore evident from the individual solutions that Borussia continues to classify the risk associated with this Dortmund has found with its partners to compensate as high priority. The financial and liquidity planning for cancelled (hospitality) services. The majority of apparatus that has been in place for many years (hospitality) services that Borussia Dortmund was considers a variety of scenarios and different unable to render due to the ongoing COVID-19 premises, and is regularly adjusted to account for pandemic were compensated for by means of other current conditions. The scenarios calculated (advertising) services, meaning that Borussia covered in particular different levels of success Dortmund's partners have asserted practically no achieved by the team and various external compensation claims. conditions attributable to COVID-19 in order to The fact that new agreements have been entered identify any liquidity bottlenecks early and to initiate into with partners despite the ongoing pandemic appropriate countermeasures designed to secure suggests that there will be no major decline in the liquidity. They included extending the existing EUR willingness of potential sponsors to seek out new 60,000 thousand overdraft facility by EUR 60,000 opportunities once the crisis is over. thousand to EUR 120,000 thousand. Due to the ongoing COVID-19 crisis, the risk of bad In order to keep the risk associated with the volume debts due to insolvency remains classified as a of player salaries as low as possible, the club high-priority risk. budgets personnel expenses with transfer deals in The COVID-19 crisis has caused one of the worst mind at the beginning of each season. The primary economic downturns for Germany and the world focus is on the fixed components of the players' in the post-war period. The ongoing pandemic will remuneration, since these are independent of the continue to impact the solvency of companies and team's performance during a given season. Variable football clubs alike. Borussia Dortmund anticipates remuneration components are also considered that problems could arise with regard to transfer when planning the budget, but generally only apply receivables. The primary objective continues to be once certain sporting objectives are achieved that keeping bad debts to a minimum and to ensure that in turn generate additional income. The personnel the Company has the liquidity it needs at all times. expenses incurred are continuously monitored, That is why it is all the more important to follow extrapolated on the basis of current circumstances, through on the action already taken, such as and reported to the management. conducting credit checks on foreign businesses or changing the general contractual framework to The Group is not presently exposed to any include high up-front payments. Dunning high-priority risks in the interest rate risk, credit procedures are likewise particularly vital. risk, resources riskand ecological riskcategories. 163