Air New Zealand 2015 Annual Report Download - page 29

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Notes to the Financial Statements (continued)
For the year to and as at 30 June 2015
Air New Zealand Annual Financial Results 2015 27
19. Reserves
2015
$M
2014
$M
Cash flow hedge reserve
Costs of hedging reserve
80
(6)
51
(3)
Hedge reserves
Investment revaluation reserve
Foreign currency translation reserve
General reserves
74
-
(44)
(351)
48
(65)
(23)
(370)
Total Reserves (321) (410)
The nature and purpose of reserves is set out below:
HEDGE RESERVES
Cash flow hedge reserve
The cash flow hedge reserve contains the effective portion of the cumulative net change in the fair value of cash flow hedging instruments related
to hedged transactions that have not yet occurred.
Costs of hedging reserve
The costs of hedging reserve contains the cumulative net change in the fair value of time value on fuel options of which are excluded from the
hedge designations of fuel price risk.
Investment revaluation reserve
The investment revaluation reserve is comprised of changes in the fair value of the investment in quoted equity instruments.
Foreign currency translation reserve
The foreign currency translation reserve contains foreign exchange differences arising on consolidation of foreign operations together with the
translation of foreign currency borrowings designated as a hedge of net investments in those foreign operations.
General reserves
General reserves include the retained deficit net of dividends recognised, remeasurements in respect of the net defined benefit assets and liabilities
and the Group’s share of equity accounted associates’ reserves.
20. Operating Leases
Leases under which a significant proportion of the risks and rewards of ownership are retained by the lessor are classified
as operating leases. Payments made under operating leases (net of any incentives received) are recognised as an expense in the
Statement of Financial Performance on a straight-line basis over the term of the lease.
2015
$M
2014
$M
Rental and lease expenses recognised in earnings
Aircraft
Property
159
52
126
48
211 174
Future operating lease commitments
Aircraft leases payable
Not later than 1 year
Later than 1 year and not later than 5 years
Later than 5 years
189
430
51
146
433
58
670 637
Property leases payable
Not later than 1 year
Later than 1 year and not later than 5 years
Later than 5 years
38
113
76
35
105
65
227 205
Subject to negotiation, certain aircraft operating leases give the Group the right to renew the lease.