Pioneer 2014 Annual Report Download - page 50

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The Group enters into foreign currency forward con-
tracts to hedge foreign exchange risk associated with
certain assets and liabilities denominated in foreign
currencies. The Group also enters into currency swap
contracts to manage its interest rate exposure and
foreign currency exposure on certain liabilities.
All derivative transactions are entered into to
hedge interest and foreign currency exposure. Accord-
ingly, market risk in these derivatives is basically offset
by opposite movements in the value of hedged assets
or liabilities.
Because the counterparties to these derivatives
are limited to major international financial institutions,
the Group does not anticipate any losses arising from
credit risk.
Derivative transactions entered into by the Group
have been made in accordance with internal policies
which regulate the authorization and credit limit amount.
15. Derivatives
Derivative transactions to which hedge accounting is not applied as of March 31, 2014 and 2013
Millions of Yen Thousands of U.S. Dollars
2014 2014
Contract
Amount
Contract
Amount
Due After
1 Year Fair Value
Unrealized
(Loss) Gain
Contract
Amount
Contract
Amount
Due After
1 Year Fair Value
Unrealized
(Loss) Gain
Foreign currency forward
contracts:
Buying U.S. dollars ¥ 515 – ¥ (2) ¥ (2) $ 5,000 – $ (19) $ (19)
Buying sterling pounds 5,244 – (31) (31) 50,913 – (301) (301)
Selling U.S. dollars 3,151 – 3 3 30,592 – 28 28
Selling Australian dollars 557 – 12 12 5,408 – 117 117
Currency swap contracts:
Receiving Australian dollars,
paying U.S. dollars
674 – 6 6 6,544 – 58 58
Total ¥10,141 – ¥(12) ¥(12) $98,457 – $(117) $(117)
48 Pioneer Corporation
Annual Report 2014