82 / 100
2 3 Ot h e r f i n a n c i a l l i a b i l i t i e s
Consolidated
2015
$’000
2014
$’000
Categorised as at fair value through profit or loss
Interest rate swaps
1,635
1,355
Total current other financial liabilities
1,635
1,355
Interest rate swaps
6,051
3,693
Total non-current other financial liabilities
6,051
3,693
7,686
5,048
The notional amount of interest rate swaps is $193m with maturity dates that range from 1-8 years (2014: $144m, maturing
between 1-8 years).
2 4 F i n a n c i a l r i s k m a n a g e m e n t
24.1 Financial risk factors
Exposure to credit, liquidity and market (currency, interest and price) risks arise in the normal course of the Group’s business. The
Group has various financial instruments with off-balance sheet risk.
Senior management are required to identify and report major risks affecting the business and develop strategies to mitigate these
risks. The board reviews and approves overall risk management strategies covering specific areas.
(a) Credit risk
Credit risk is the risk that a third party will default on its obligations to the Group, causing the Group to incur a loss. The Group
does not have any significant concentrations of credit risk, other than the relativity settlement receivable and the co-management
settlement receivable expected from the Crown (see also note 14). The maximum exposure to credit risk at reporting date is the
carrying amount of the financial assets as shown in the statement of financial position. The Group does not require any collateral
or security to support financial instruments as it only deposits with, or lends to, banks and other financial institutions with high
credit ratings except for funds lent to a related party and an external entity for which the Group has appropriate security and
guarantees. The Group further minimises credit exposure by limiting the amount of surplus funds placed with any one financial
institution. The cash and cash equivalents of $177m (2014: $171m) are held with bank and financial institution counterparties,
which are rated AA- to A+, based on Standards and Poors ratings. The Group does not expect non-performance of any obligations
at balance date. There are no material financial assets held by the Group at balance date which are past due but not impaired.
(b) Market risk
(i) Currency
The Group has no material exposure to currency risk at balance date.
There are no notional principal or forward foreign exchange contracts at 31 March 2015 (2014: nil).
(ii) Interest rate risk
The Group’s interest rate risk arises from long-term borrowings. Borrowings issued at variable rates expose the Group to cash flow
interest rate risk. Borrowings issued at fixed rate expose the Group to fair value interest rate risk.
The Group adopts a policy of ensuring that between 25 and 90 per cent of its exposure to changes in interest rates on borrowings
is on a fixed rate basis.
waikato raupatu lands trust
notes to the financial statements
f o r t h e y e a r e n d e d 3 1 m a r c h 2 0 1 5
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