NOTE 10
CURRENT ASSETS – OTHER CURRENT ASSETS
Consolidated
2013
$’000
2012
$’000
Prepayments - other
4,774
3,636
Other current assets
412
532
5,186
4,168
NOTE 11
DERIVATIVE FINANCIAL INSTRUMENTS
Consolidated
2013
$’000
2012
$’000
Current assets
Forward foreign exchange contracts - cash flow hedges (a)
100
175
Total current derivative financial instrument assets
100
175
Current liabilities
Forward foreign exchange contracts - cash flow hedges ((a)(ii))
-
33
Total current derivative financial instrument liabilities
-
33
Non-current liabilities
Interest rate swaps - cash flow hedges (a)
7,981
5,446
Total non-current derivative financial instrument liabilities
7,981
5,446
Total derivative financial instrument liabilities
7,981
5,479
(7,881)
(5,304)
(a) Instruments used
by the group
The Group is party to derivative financial instruments
in the normal course of business in order to hedge
exposure to fluctuations in interest rate and foreign
exchange rates in accordance with the Group’s Board
approved Treasury Policy.
(i) Interest rate swap contracts -
cash flow hedges
In April 2013 the Group as a part of the $750m
domestic note program executed the third bond
issuance of $250m to mature on 29 April 2016. The
bonds were issued 50% as fixed and 50% on a floating
rate which is repayable in 3 years, interest is re-priced
semi annually for the fixed portion and quarterly for
the floating portion and both payable in arrears. As
a result, ARTC was exposed to fluctuations in the
benchmark interest rate (BBSW).
To reduce this exposure ARTC entered into a 3 year
interest rate swap (IRS) on 29 April 2013 to hedge its
$125m floating rate bond issue to a fixed rate therefore
no longer exposed to fluctuations in the BBSW rate.
Only exposure to the quarterly BBSW has been
designated as the hedged risk.
The gain or loss from re-measuring the hedging
instruments at fair value is recognised in other
comprehensive income and deferred in equity in
the hedging reserve, to the extent that the hedge is
effective. It is reclassified into profit or loss when the
hedged interest expense is recognised. In the year
ended 30 June 2013 there was no reclassification
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