by clicking the arrows at the side of the page, or by using the toolbar.
by clicking anywhere on the page.
by dragging the page around when zoomed in.
by clicking anywhere on the page when zoomed in.
web sites or send emails by clicking on hyperlinks.
Email this page to a friend
Search this issue
Index - jump to page or section
Archive - view past issues
Whitehaven Coal Limited : Annual Report 2013
130 Whitehaven Coal Limited Annual Report 2013 Notes to the Financial Statements 30 June 2013 Risk exposures and responses Foreign currency risk The consolidated entity is exposed to currency risk on sales, purchases and demurrage that are denominated in a currency other than the respective functional currency of the consolidated entity, the Australian dollar (AUD). The currency in which these transactions primarily are denominated is US Dollars (USD). The consolidated entity uses forward exchange contracts (FECs) to hedge its currency risk. The Hedging Policy of the consolidated entity is to utilise forward exchange contracts to cover up to: • 100% of contracted sales where both volume and US dollar price are xed; • 90% of contracted sales where volume is xed but pricing is provisional; • 80% of planned sales from existing operations over a 12 month period; and • a maximum of 50% of planned sales from existing operations for between 12 and 24 months. No cover is taken out beyond 24 months other than contracted sales where both volume and US dollar prices are xed. In respect of other monetary assets and liabilities denominated in foreign currencies, the consolidated entity ensures that its net exposure is kept to an acceptable level by buying and selling foreign currencies at spot rates when necessary to address short-term imbalances. The consolidated entity classi es its forward exchange contracts as cash ow hedges and measures them at fair value. The fair value of forward exchange contracts used as hedges at 30 June 2013 was a liability of $4,938,000 (2012: $4,221,000 asset), comprising assets and liabilities that were recognised as fair value derivatives. At 30 June 2013, the consolidated entity had the following nancial instruments that were not designated in cash ow hedges that were exposed to foreign currency risk: In thousands of USD USD 30 June 2013 USD 30 June 2012 Cash 25,682 31,801 Trade and other receivables 38,212 27,582 Trade and other payables (21,030) (5,086) Finance lease liabilities (8,637) (11,421) Net statement of nancial position exposure 34,227 42,876 Currency risk exposure arising from derivative nancial instruments is disclosed in note 17. The following exchange rates applied during the year: Average rate Reporting date spot rate Fixed rate instruments 2013 2012 2013 2012 USD 1.0271 1.0319 0.9275 1.0191 EUR 0.7949 0.7707 0.7095 0.8092 5. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES CONTINUED
Annual Report 2012