BP 2008 Annual Report Download - page 143

BP Annual Report and Accounts 2008
Notes on financial statements
28. Financial instruments and financial risk factors
The accounting classification of each category of financial instruments, and their carrying amounts, are set out below.
$ million
At 31 December 2008
Financial
Available-for- At fair value Derivative liabilities Total
Loans and sale financial through profit hedging measured at carrying
Note receivables assets and loss instruments amortized cost amount
Financial assets
Other investments – listed 29 – 592 – – – 592
Other investments – unlisted 29 – 263 – – – 263
Loans 1,163 – – – – 1,163
Trade and other receivables 31 29,489 – – – – 29,489
Derivative financial instruments 34 – – 12,501 1,063 – 13,564
Cash at bank and in hand 32 4,001 – – – – 4,001
Cash equivalents – listed 32 – 4,060 – – – 4,060
Cash equivalents – unlisted 32 – 136 – – – 136
Financial liabilities
Trade and other payables 33 – – – – (33,140) (33,140)
Derivative financial instruments 34 – – (13,173) (2,075) – (15,248)
Accruals – – – – (7,527) (7,527)
Finance debt 35 – – – – (33,204) (33,204)
34,653 5,051 (672) (1,012) (73,871) (35,851)
$ million
At 31 December 2007
Financial
Available-for- At fair value Derivative liabilities Total
Loans and sale financial through profit hedging measured at carrying
Note receivables assets and loss instruments amortized cost amount
Financial assets
Other investments – listed 29 – 1,617 – – – 1,617
Other investments – unlisted 29 – 213 – – – 213
Loans 1,164 – – – – 1,164
Trade and other receivables 31 38,710 – – – – 38,710
Derivative financial instruments 34 – – 9,155 907 – 10,062
Cash at bank and in hand 32 2,996 – – – – 2,996
Cash equivalents – listed 32 – 3 – – – 3
Cash equivalents – unlisted 32 – 563 – – – 563
Financial liabilities
Trade and other payables 33 – – – – (40,062) (40,062)
Derivative financial instruments 34 – – (11,284) (123) – (11,407)
Accruals – – – – (7,599) (7,599)
Finance debt 35 – – – – (31,045) (31,045)
42,870 2,396 (2,129) 784 (78,706) (34,785)
The fair value of finance debt is shown in Note 35. For all other financial instruments, the carrying amount is either the fair value, or approximates
the fair value.
Financial risk factors
The group is exposed to a number of different financial risks arising from natural business exposures as well as its use of financial instruments
including market risks relating to commodity prices, foreign currency exchange rates, interest rates and equity prices, credit risk and liquidity risk.
The group financial risk committee (GFRC) advises the group chief financial officer (CFO) who oversees the management of these risks. The
GFRC is chaired by the CFO and consists of a group of senior managers including the group treasurer and the heads of the finance, tax and the
integrated supply and trading functions. The purpose of the committee is to advise on financial risks and the appropriate financial risk governance
framework for the group. The committee provides assurance to the CFO and the group chief executive (GCE), and via the GCE to the board, that the
group’s financial risk-taking activity is governed by appropriate policies and procedures and that financial risks are identified, measured and managed
in accordance with group policies and group risk appetite.
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