Tesco 2006 Annual Report Download - page 79

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77Tesco plc
Note 20 Financial instruments continued
Financial instruments under UK GAAP FRS 13 (relating to the comparative period ended 26 February 2005) continued
Other significant financial instruments outstanding as at 26 February 2005 were £479m nominal value forward foreign exchange
contracts hedging the cost of foreign currency denominated purchases. On a marking-to-market basis, these contracts showed
aloss of £15m. The fair values of interest rate swaps, forward foreign exchange contracts and long-term fixed rate debt were
determined by reference to prices available from the markets on which the instruments were traded. The fair values of all other items
were calculated by discounting expected future cash flows at prevailing interest rates.
Hedges
Gains and losses on instruments used for hedging interest rates and currency risks, unrealised as at 26 February 2005, and those
recognised in the year ended 26 February 2005 were as follows:
Unrecognised Deferred
Gains Losses Total Gains Losses Total
£m £m £m £m £m £m
At 28 February 2004 6 (214) (208) 211 – 211
Arising in previous years and recognised
in the year ended 26 February 2005 (1) 44 43 (48) – (48)
Arising in the period to be recognised in future years 9 (44) (35) – – –
At 26 February 2005 14 (214) (200) 163 – 163
Note 21 Provisions
Property
provisions
£m
At 26 February 2005 9
Additions 1
Amount credited in the year (3)
At 25 February 2006 7
Property provisions comprise future rents payable net of rents receivable on onerous and vacant property leases, provisions for
terminal dilapidations and provisions for future rents above market value on unprofitable stores. The majority of the provision is
expected to be utilised over the period to 2017.
The balances are analysed as follows:
2006 2005
£m £m
Current 23
Non-current 56
79