Telstra 2013 Annual Report Download - page 123

NOTES TO THE
FINANCIAL STATEMENTS
(CONTINUED)
FINANCIAL STATEMENTS
Telstra Corporation Limited and controlled entities Telstra Annual Report 2013 121
(c) Net position on a contractual face value basis
The amounts disclosed in Table D represent the net contractual
face values of our financial instruments on a post hedge basis.
(i) These amounts represent the end hedge position as described in
our hedge relationships in note 18, Table H.
(ii) Includes offshore loans of nil (2012: $200 million) used to hedge
our investment in TelstraClear Limited as described in note 18,
Table K. The balance also includes $146 million (2012: $49 million)
relating to finance leases and $4 million (2012: $2 million) other
loans.
(iii) Includes final pay legs $556 million (2012: $638 million) as
described in note 18 Table J. The balance also includes receive
legs relating to hedges of forecast purchases, trade and other non
interest bearing liabilities of $467 million (2012: $525 million).
(iv) Comprises promissory notes used to hedge our investment in
TelstraClear Limited as described in note 18 Table K. We disposed
of TelstraClear on 31 October 2012. Refer to note 20 for further
details.
The above table represents our economic residual position after
netting offsetting risks of our derivative and non-derivative financial
instruments in a hedge relationship.
Accordingly, consistent with our policy to swap foreign currency
borrowings into Australian dollars, only our Australian dollar end
positions are included in the table above, except for a small
proportion of financial instruments used to hedge translation foreign
exchange risk associated with our offshore investments, and some
cash balances and borrowings held in foreign currencies by our
foreign controlled entities. These foreign currency amounts are
reported in Australian dollars based on the applicable exchange
rate as at 30 June.
Total net debt in Table D agrees to the face value of our financial
instruments included in net debt in Table C. The face values differ
from the statement of financial position carrying amounts. The
carrying amounts reflect a part of our borrowing portfolio at fair
value with the remaining part at amortised cost, whereas the face
values represent the undiscounted contractual liability at maturity
date.
17. CAPITAL MANAGEMENT AND FINANCIAL INSTRUMENTS (CONTINUED)
Table D Telstra Group
As at 30 June
Face value
2013 2012
Currency $m $m
Interest bearing financial assets included in net debt
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . Floating Australian dollar 2,076 3,591
Cash and cash equivalents held in foreign currencies . . . . . . . . . . . Floating Various 336 338
2,412 3,929
Interest bearing financial liabilities included in net debt
Cross currency and interest rate swap liability (i) . . . . . . . . . . . . . . Fixed Australian dollar (7,311) (5,841)
Borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Fixed Australian dollar (1,653) (2,549)
Borrowings (ii) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Fixed Foreign (150) (251)
Cross currency and interest rate swap liability (i) . . . . . . . . . . . . . . Floating Australian dollar (5,373) (6,950)
Borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Floating Australian dollar (505) (1,189)
Forward contract liability - net (iii) . . . . . . . . . . . . . . . . . . . . . . Floating Australian dollar (89) (113)
Cross currency swap liability - net . . . . . . . . . . . . . . . . . . . . . . Floating Foreign (584) (233)
Borrowings (iv). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Floating Foreign -(277)
(15,665) (17,403)
Net interest bearing debt . . . . . . . . . . . . . . . . . . . . . . . . . . (13,253) (13,474)
Non-interest bearing cash included in net debt . . . . . . . . . . . . . . . Various 78 67
Net debt - based on contractual face values . . . . . . . . . . . . . . . (13,175) (13,407)
Other interest bearing financial assets . . . . . . . . . . . . . . . . . . . Fixed Australian dollar 695 627
Net interest bearing financial liabilities - based on contractual face values (12,480) (12,780)