National Grid 2011 Annual Report Download - page 47

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National Grid Gas plc Annual Report and Accounts 2010/11 45
6. Finance income and costs
2011 2010
£m £m
Interest income and similar income
Interest income on financial instruments (i) 23
Interest income and similar income 2 3
Interest expense and other finance costs
Interest expense on financial liabilities held at amortised cost:
Bank loans and overdrafts
(
50
)
(13)
Other borrowings
(
396
)
(284)
Derivatives 71 42
Other interest
(
9
)
(8)
Unwinding of discount on provisions
(
3
)
(2)
Less: interest capitalised (ii) 15 8
Interest expense and other finance costs before exceptional items and remeasurement
s
(
372
)
(257)
Exceptional items
Exceptional debt redemption costs
(
31
)
-
Remeasurements
Net gains/(losses) on derivative financial instruments included in remeasurements (iii):
Ineffectiveness on derivatives designated as fair value hedges (iv) 13 25
Ineffectiveness on derivatives designated as cash flow hedges 43
On derivatives not designated as hedges or ineligible for hedge accounting
(
10
)
5
733
Exceptional items and remeasurements included within interest expens
e
(
24
)
33
Interest expense and other finance costs
(
396
)
(224)
Net finance costs
(
394
)
(221)
(i)
(ii)
(iii)
(iv)
Interest on funding attributable to assets in the course of construction was capitalised during the year at a rate of 5.6% (2010: 3.6%).
Includes a net foreign exchange gain on financing activities of £38m (2010: £84m). These amounts are offset by foreign exchange gains and losses on derivative financial
instruments measured at fair value.
Interest income on financial instruments comprises interest income from bank deposits and other financial assets.
Includes a net gain on instruments designated as fair value hedges of £53m (2010: £85m loss) offset by a net loss of £40m arising from the fair value adjustments to the
carrying value of debt (2010: £110m gain).