Telstra 2010 Annual Report Download - page 159

Telstra Corporation Limited and controlled entities
144
Notes to the Financial Statements (continued)
(c) Hedge Relationships (continued)
Table J describes each of our hedge relationships, where forward
foreign currency exchange contracts are used as the hedging
instruments. These relationships comprise effective economic
relationships based on contractual face value amounts and cash
flows, including relationships that are not in a designated hedge
relationship for hedge accounting purposes. These hedging
instruments are used to economically hedge our promissory notes,
forecast transactions denominated in foreign currency, foreign
currency trade and other liabilities.
Outlined in the following table is the pre hedge underlying
exposure, each leg of the forward foreign currency contract and the
end post hedge position. This post hedge position represents our
net final currency positions and is represented in our residual
economic position as described in note 17 Table H.
(i) The carrying value of our forward foreign currency contracts
with a contractual maturity of greater than 12 months is not
material and have been included within current assets and current
liabilities.
18. Financial risk management (continued)
Table J Telstra Group
Derivative hedging instruments
- forward foreign currency contracts
Face value Notional value
Average exchange
rate
Pre hedge
underlying exposure
(payable)
Forward contract
receive
Forward contract
pay - final leg
Native Currency Native currency Australian dollars
2010 2009 2010 2009 2010 2009 2010 2009
$m $m $m $m $m $m
Forward contracts hedging interest
bearing debt
Promissory notes
United States dollar - contractual maturity
2 months (2009: 0-3 months) . . . . . (60) -60 -(70) -0.8574 -
New Zealand dollars - contractual maturity nil
(2009: 3-12 months) . . . . . . . . . -(20) -20 -(18) -1.13310
Loans from wholly owned controlled entities
British pounds sterling - contractual maturity
0-3 months (2009: 0-3 months) . . . . (5) (3) 53(10) (6) 0.5883 0.46806
New Zealand dollars - contractual maturity
0- 3 months (2009: 0-3 months) . . . . (317) (253) 317 253 (243) (200) 1.2527 1.26368
United States dollars - contractual maturity
0- 3 months (2008: 0-3 months) . . . . (16) (22) 16 22 (17) (28) 0.8716 0.78608
Forward contracts hedging forecast
purchases and other liabilities
Forecast transactions
United States dollar - contractual maturity
0-24 months (2008: 0-12 months) (i) . . . (581) (495) 581 495 (695) (709) 0.8447 0.69761
Euro - contractual maturity 5 - 12 months
(2009: 0 - 12 months) . . . . . . . . . . (2) (2) 22(3) (4) 0.6841 0.55541
Hong Kong dollar - contractual maturity nil
(2009: 0-3 months) . . . . . . . . . . . . -(3) -3-(1) -5.98057
Trade and other liabilities - non interest
bearing
United states dollars- contractual maturity
0-38 months (2009: 0-12 months) (i) . . (144) (63) 144 63 (173) (79) 0.8318 0.79123
Euro - contractual maturity nil (2009: 0 - 3
months). . . . . . . . . . . . . . . . . -(2) -2-(4) -0.57435
(1,211) (1,049)