Singapore Airlines 2014 Annual Report Download - page 198

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196
NOTES TO THE FINANCIAL STATEMENTS
31 March 2014
SINGAPORE AIRLINES
38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued)
(d) Market rate risk
At 31 March 2014, the Group and the Company own investments of $1,313.7 million (2013: $957.4 million) and
$1,259.6 million (2013: $897.4 million) respectively, which are subject to market rate risk. The market risk associated
with these investments is the potential loss resulting from a decrease in market prices.
Market price sensitivity analysis
If prices for these investments increase or decrease by 1% with all other variables being held constant, the before tax
effects on equity are set out in the table below.
Sensitivity analysis on investments:
The Group The Company
31 March 31 March
2014 2013 2014 2013
Effect on equity Effect on equity
Increase in 1% of quoted prices 8.6 5.9 8.1 5.3
Decrease in 1% of quoted prices (8.6) (5.9) (8.1) (5.3)
(e) Liquidity risk
At 31 March 2014, the Group has at its disposal, cash and short-term deposits amounting to $4,883.9 million (2013:
$5,059.6 million). In addition, the Group has available short-term credit facilities of about $300.0 million (2013: $374.2
million). The Group also has a Medium Term Note Programmes under which it may issue notes up to $2,000.0 million
(2013: $1,000.0 million) and as of 31 March 2014, $1,500.0 million (2013: $500.0 million) remains unutilised. Under
these Programmes, notes issued by the Company may have varying maturities as agreed with the relevant financial
institutions.
The Group’s holdings of cash and short-term deposits, together with committed funding facilities and net cash flow
from operations, are expected to be sufficient to cover the cost of all firm aircraft deliveries due in the next financial
year. It is expected that any shortfall would be met by bank borrowings or public market funding. Due to the necessity
to plan aircraft orders well in advance of delivery, it is not economical for the Group to have committed funding in
place at present for all outstanding orders, many of which relate to aircraft which will not be delivered for several years.
The Group’s policies in this regard are in line with the funding policies of other major airlines.
The maturity profile of the financial liabilities of the Group and the Company is as follows. The amounts disclosed
in the table are the contractual undiscounted cash flows. Balances due within 12 months approximate their carrying
amounts as the impact of discounting is insignificant.