✨ Financial Statements
4092 NEW ZEALAND GAZETTE, No. 140 23 NOVEMBER 2012
10. Derivatives and hedge commitment
This note shows the short term (ST) and long term (LT) breakdown of the derivatives and hedge commitment.
| 2012 | ST asset $M | LT asset $M | ST (liability) $M | LT (liability) $M | Total asset (liability) $M |
|---|---|---|---|---|---|
| Debt related derivatives | |||||
| Cross currency interest rate swaps | - | 105.9 | - | (3.7) | 102.2 |
| Interest rate swaps | 16.0 | 59.6 | (68.6) | (331.1) | (324.1) |
| Basis swaps | - | - | - | (1.8) | (1.8) |
| FX swaps | 0.1 | - | - | - | 0.1 |
| 16.1 | 165.5 | (68.6) | (336.6) | (223.6) |
| Purchasing related derivatives and hedge commitment |
| Foreign exchange forward contracts |
| Commitment on fair value hedges | 31.6 | 4.3 | (31.6) | (4.3) | (35.9) |
| | 31.6 | 4.3 | (31.6) | (4.3) | (35.9) |
| Total derivatives and hedge commitment |
| | 47.7 | 169.8 | (100.2) | (340.9) | (223.6) |
| Commitment on fair value hedges (above) |
| | 31.6 | 4.3 | - | - | 35.9 |
| Total derivatives | 16.1 | 165.5 | (100.2) | (340.9) | (259.5) |
| 2011 | ST asset $M | LT asset $M | ST (liability) $M | LT (liability) $M | Total asset (liability) $M |
|---|---|---|---|---|---|
| Debt related derivatives | |||||
| Cross currency interest rate swaps | 6.3 | 106.0 | (22.8) | (63.4) | 26.1 |
| Interest rate swaps | 10.2 | 54.6 | (72.2) | (144.8) | (152.2) |
| Basis swaps | - | 1.0 | - | - | 1.0 |
| 16.5 | 161.6 | (95.0) | (208.2) | (125.1) |
| Purchasing related derivatives and hedge commitment |
| Foreign exchange forward contracts |
| Commitment on fair value hedges | 0.2 | - | (35.7) | (6.1) | (41.6) |
| | 35.7 | 6.1 | (35.7) | (6.1) | (41.8) |
| Total derivatives and hedge commitment |
| | 52.4 | 167.7 | (130.7) | (214.3) | (124.9) |
| Commitment on fair value hedges (above) |
| | 35.7 | 6.1 | - | - | 41.8 |
| Total derivatives | 16.7 | 161.6 | (130.7) | (214.3) | (166.7) |
Derivatives are used to manage financial risk. The gain or loss on derivatives represents the unrealised gain or loss at balance date. The Transpower Lines Business anticipates that the derivatives will be held until maturity, and it is unlikely that settlement at the reported fair values will occur.
Debt and purchasing related derivatives
The nature of the debt and purchasing related derivatives is discussed in Note 17 Debt, financial instruments and risk management.
Commitment on fair value hedges
The Transpower Lines Business hedges against foreign currency fluctuations on certain foreign purchases through the use of foreign exchange forward contracts (FEC’s). The hedge commitment represents the non derivative fair value movement, attributable to foreign exchange movements, on the commitment to buy the goods, i.e. before the goods or an invoice are received. The fair value of the derivative (FEC) is shown separately (in the same note).
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NZ Gazette 2012, No 140
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Transpower New Zealand Limited Financial Statements
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🏭 Trade, Customs & IndustryFinancial instruments, Categorisation, Transpower, Fair value, Derivatives