✨ Financial Statements Notes
HORIZON ENERGY DISTRIBUTION LIMITED - Lines Business
NOTES TO THE FINANCIAL STATEMENTS
17 CAPITAL COMMITMENTS
The Group has commitments for future capital expenditure amounting to $201,000 ((nil in 2003)).
18 FINANCIAL INSTRUMENTS
(a) The nature of activities and management policies with respect to financial instruments is described as follows:
(i) Interest Rates
The Group generally uses swaps to manage interest rate risk.
As at 31 March 2004, the face value of the swaps the Group held were as follows:
| Interest Rate Options: | Rate | Term | Commencement Date | 2004 | 2003 |
|---|---|---|---|---|---|
| 7.07% | Nine Years | 3 April, 1998 | 6,900 | 6,900 | |
| 6.76% | 45 Months | 20 March, 2003 | 4,000 | 4,000 | |
| 7.27% | 66 Months | 20 December, 2000 | 4,000 | 4,000 | |
| 7.16% | Six Years | 29 June, 2001 | 4,000 | 4,000 | |
| 6.68% | Seven Years | 16 August, 2002 | 3,000 | 3,000 | |
| 5.64% | One Year | 11 February, 2003 | - | 3,000 |
The total face value for 2004 was 21,900 and for 2003 was 24,900.
The mark to market value of the interest rate swap agreements as at 31 March 2004 showed a loss of $759,309 (2003 - loss of $902,286). No provision is made for any potential loss.
(ii) Credit
In the normal course of its business the Company incurs credit risk from trade debtors and financial institutions. The Company has a credit policy which is used to manage this exposure to credit risk. As part of this policy, limits on exposures have been set and are monitored on a regular basis.
(b) Fair Values
The fair value of Term Loans is $28.285 million which is the same as the carrying value disclosed in Note 11.
19 PROVISIONS
| Balance at beginning of year | 304 |
| Current year provision | 90 |
| Provision released | (304) |
| Balance at 31 March | 90 |
The provision includes allowances for costs associated with disputes.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2004, No 172
Gazette.govt.nz —
NZ Gazette 2004, No 172
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Financial Statements Notes for Horizon Energy Distribution Limited
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🏭 Trade, Customs & IndustryFinancial Statements, Capital Commitments, Financial Instruments, Interest Rates, Credit Risk, Provisions