Qantas 2015 Annual Report Download - page 84

Download and view the complete annual report

Please find page 84 of the 2015 Qantas annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

83
QANTAS ANNUAL REPORT 2015
33. RELATED PARTIES
(A) REMUNERATION OF KEY MANAGEMENT PERSONNEL
The aggregate remuneration of the KMP of the Qantas Group is set out below:
Qantas Group
2015
$’000
2014
$’000
Short-term employee benefits 13,985 9,129
Post-employment benefits 605 522
Other long-term benefits 306 (285)
Share-based payments 6,463 4,421
Termination benefits 1,316 –
22,675 13,787
Further details in relation to the remuneration of KMPs are included in the Directors’ Report from pages 28 to 46.
(B) OTHER RELATED PARTY TRANSACTIONS – INVESTMENTS ACCOUNTED FOR UNDER THE EQUITY METHOD
Transactions with investments accounted for under the equity method are conducted on normal terms and conditions.
Transactions between the Qantas Group and associates include:
–The Qantas Group provides airline seats on domestic and international routes to Helloworld Ltd for sale through its travel agency
network
–The Qantas Group sells Frequent Flyer points to Helloworld Ltd and redeems vouchers on the Qantas Frequent Flyer store
–The Qantas Group established a business service agreement with Jetstar-branded airlines in Japan, Hong Kong and Vietnam for
the provision of business services to enable the low cost airline to operate a consistent customer experience for the Jetstar brand
–The Qantas Group provided a secured aircraft facility to Jetstar Hong Kong to facilitate the acquisition of aircraft.
Transactions and balances with investments accounted for under the equity method are included in the Consolidated Financial
Statements as follows:
Qantas Group
2015
$M
2014
$M
Revenue and other income 60 61
Finance income 5 6
Expenditure 61 49
Receivables 67 292
Payables 6 5
34. FINANCIAL RISK MANAGEMENT
A financial instrument is any contract that gives rise to both a financial asset of one entity and a financial liability or equity
instrument of another entity.
The Qantas Group is subject to liquidity, interest rate, foreign exchange, fuel price and credit risks. These risks are an inherent part
of the operations of an international airline. The Qantas Group manages these risk exposures using various financial instruments,
governed by a set of policies approved by the Board. The Qantas Group’s policy is not to enter into, issue or hold derivative financial
instruments for speculative trading purposes.
The Qantas Group uses different methods to assess and manage different types of risk to which it is exposed. These methods include
correlations between risk types, sensitivity analysis in the case of interest rate, foreign exchange and other price risks, and ageing
analysis and sensitivity analysis for liquidity and credit risk.
(A) LIQUIDITY RISK
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. The Qantas
Group manages liquidity risk by targeting a minimum liquidity level, ensuring long-term commitments are managed with respect
to forecast available cash inflows, maintaining access to a variety of additional funding sources, including commercial paper and
standby facilities and managing maturity profiles.
Qantas may from time to time seek to purchase and retire outstanding debt through cash purchases in open market transactions,
privately negotiated transactions or otherwise. Any such repurchases would depend on prevailing market conditions, liquidity
requirements and possibly other factors.
The following tables summarise the contractual timing of cash flows, including estimated interest payments, of financial liabilities
and derivative instruments. Contractual amount assumes current interest rates and foreign exchange rates.