Porsche 2011 Annual Report Download - page 165

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As soon as the criteria of IAS 39 for hedge accounting are fulfilled, the derivative financial instruments
are designated either as fair value or cash flow hedges. Otherwise, they are allocated to the category financial
assets or liabilities held for trading.
A fair value hedge hedges the exposure to changes in fair value of a recognized asset, a recognized
liability or an unrecognized firm commitment. Gains or losses arising from marking hedging instruments to
market and the secured portion of the risk of the hedged transaction are recognized in profit or loss. If the fair
value hedge ends, the adjustment of the carrying amount arising from fair value hedge accounting for financial
instruments measured at amortized cost as hedged transaction is released to profit or loss over the remaining
term of the hedged transaction.
In the case of portfolio-based fair value hedges, the accounting for changes in fair value corresponds
to the accounting for fair value hedges. Gains or losses from changes in measurement are recognized through
profit or loss.
A cash flow hedge is used to hedge exposures from highly probable future cash flows. Hedges are only
included in hedge accounting to the extent that they offset changes in the value of the cash flows of the
hedged transaction. The ineffective portion is immediately recognized in profit or loss. When included in cash
flow hedge accounting, changes in value are recorded directly in other comprehensive income, taking deferred
taxes into account. When the hedged transaction occurs, the change in value is reclassified from other
comprehensive income to profit or loss. If the forecast transaction is no longer expected to occur, the
cumulative gain or loss previously recognized in equity is reclassified to profit or loss. Gains or losses from
cash flow hedge accounting are presented under other operating income or expenses in the income statement.
The options held by the Porsche SE group as of the reporting date generally are not traded on a public
market. In such cases, IAS 39.48 et seq. requires that a suitable valuation technique or recent transaction be
used for measurement purposes. Measurement was performed using generally accepted valuation techniques
based on observable market data and historical values.
Offsetting of financial instruments
Financial assets and liabilities are presented net in the balance sheet only if the group has a present
contractual right to settle net and if it intends to settle net or by realizing the liability together with the asset.
Cash, cash equivalents and time deposits
The cash, cash equivalents and time deposits include checks, cash on hand and at banks. This item
may also include cash and cash equivalents that are not freely available for use by the Porsche SE group.
There was no restricted cash as of the reporting date or as of 31 December 2010.
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