✨ Financial Statements
4004 NEW ZEALAND GAZETTE, No. 159 29 NOVEMBER 2010
TRANSPOWER NEW ZEALAND LIMITED LINES BUSINESS
6. Change in fair value of financial instruments
| LINES BUSINESS |
|---|
Accounting hedges
Fair value movement forward exchange contracts - hedge accounted
| | (29,516) | 204 |
Fair value movement hedge commitment
| | 29,784 | (440) |
| | 268 | (236) |
Other
Fair value movement foreign debt
| | (31,300)| (105,146) |
Fair value movement cross currency interest rate swaps
| | (13,260)| 128,381 |
Fair value movement foreign interest rate swaps
| | 4,615 | 15,325 |
Fair value movement basis swaps
| | (240) | 240 |
Fair value movement interest rate options
| | 362 | (250) |
Fair value movement NZD interest rate swaps
| | (99,314)| (104,279) |
Fair value movement forward exchange contracts - not hedge accounted
| | 1,789 | (3,037) |
Fair value movement investments
| | - | 470 |
Fair value movement NZD debt
| | (37,821)| 7,287 |
| | (112,566)| (61,009) |
Total fair value gain (loss)
| | (112,288)| (61,245) |
The above fair value movements are as a result of the Lines Business designating these instruments at fair value through profit or loss or as fair value hedges. Refer to Note 10 Financial Instrument Categorisation for further information.
Credit Spread Impact
The profit or loss impact of credit risk on fair value was a $6m loss in 2010 (2009: $70m gain). The cumulative (balance sheet) impact was a $64m gain in 2010 (2009: $70m gain). The credit spread was calculated by comparing the swap curve with the applicable rating yield curve.
Foreign Purchases
The Transpower Lines Business hedges against foreign currency fluctuations on certain foreign purchases through the use of forward exchange contracts. The "hedge commitment" represents the non derivative fair value movement on the commitment to buy the goods, i.e. before the goods or an invoice are received. Note that, although all forward exchange contracts are used for economically hedging foreign purchases, not all forward exchange contracts are hedge accounted.
Debt and Investments
Refer to Note 24 Financial Instruments for information on the use of debt, investments and derivatives.
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NZ Gazette 2010, No 159
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Transpower New Zealand Limited Financial Statements
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🏭 Trade, Customs & Industry19 November 2010
Financial statements, Fair value, Accounting hedges, Foreign debt, Swaps, Investments