Telstra 2011 Annual Report Download - page 170

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Telstra Corporation Limited and controlled entities
155
Notes to the Financial Statements (continued)
(c) Hedge Relationships (continued)
Table J describes each of our hedge relationships, where forward
foreign currency exchange contracts are used as the hedging
instruments. These relationships comprise effective economic
relationships based on contractual face value amounts and cash
flows, including relationships that are not in a designated hedge
relationship for hedge accounting purposes. These hedging
instruments are used to economically hedge our promissory notes,
forecast transactions denominated in foreign currency, and foreign
currency trade and other liabilities.
Outlined in the following table is the pre hedge underlying
exposure, each leg of the forward foreign currency contract and the
end post hedge position. This post hedge position represents our
net final currency positions and is represented in our residual
economic position as described in note 17 Table D.
18. Financial risk management (continued)
Table J Telstra Group
Derivative hedging instruments
- forward foreign currency contracts
Face value Notional value
Average exchange
rate
Pre hedge
underlying exposure
(payable)
Forward contract
receive
Forward contract
pay - final leg
Native Currency Native currency Australian dollars
2011 2010 2011 2010 2011 2010 2011 2010
$m $m $m $m $m $m
Forward contracts hedging interest
bearing debt
Promissory notes
United States dollars - contractual maturity
2 months (2010: 0-2 months) . . . . . . . (300) (60) 300 60 (286) (70) 1.0496 0.8574
Loans from wholly owned controlled entities
British pounds sterling - contractual maturity
0-3 months (2010: 0-3 months) . . . . . . (18) (5) 18 5(28) (10) 0.6457 0.5883
New Zealand dollars - contractual maturity
0-3 months (2010: 0-3 months) . . . . . . (363) (317) 363 317 (277) (243) 1.3096 1.2527
United States dollars - contractual maturity
0-3 months (2010: 0-3 months) . . . . . . (20) (16) 20 16 (19) (17) 1.0254 0.8716
Forward contracts hedging forecast
purchases and other liabilities
Forecast transactions
United States dollars - contractual maturity
0-12 months (2010: 0-24 months) . . . . . (653) (914) 653 914 (309) (695) 0.9947 0.8447
Euro - contractual maturity nil (2010: 5-12
months). . . . . . . . . . . . . . . . . . -(2) -2-(3) -0.6841
Swedish Krona - contractual maturity 0-3
months (2010: nil). . . . . . . . . . . . . (20) -20 -(2) -6.3482 -
Trade and other liabilities - non interest
bearing
United states dollars - contractual maturity
0-21 months (2010: 0-38 months) . . . . . (104) (144) 104 144 (108) (173) 0.9652 0.8318
(1,029) (1,211)