World Fuel Services 2013 Annual Report Download - page 41

Interest Rate
Borrowings under our Credit Facility and Term Loans related to base rate loans or eurodollar rate loans bear floating interest rates plus
applicable margins. As of December 31, 2013, the applicable margins for base rate loans and eurodollar rate loans were 1.0% and
2.0%, respectively. As of December 31, 2013, we had $200.0 million of outstanding borrowings under our Credit Facility and
borrowings of $242.5 million under our Term Loans. As of December 31, 2013, the aggregate outstanding balance of our promissory
notes issued in connection with our acquisitions was $13.4 million, which bear interest at annual rates ranging from 1.2% to 6.0%. The
remaining outstanding debt of $7.8 million as of December 31, 2013 primarily relates to capital leases and loans payable to
noncontrolling shareholders of a consolidated subsidiary, which bear interest at annual rates ranging from 2.0% to 6.3%. The weighted
average interest rate on our short-term debt was 2.1% and 2.4% as of December 31, 2013 and 2012, respectively. A 1.0% fluctuation
in the interest rate on our outstanding debt would result in a $4.6 million change in interest expense during the next twelve months.
Foreign Currency
We analyzed our assets and liabilities denominated in currencies other than their respective functional currencies to identify
consolidated currency exposures as of December 31, 2013, including derivatives utilized to hedge such exposures. For these assets
and liabilities, we then assessed the effect of a hypothetical uniform 10% strengthening in the value of the U.S. dollar relative to these
other currencies. This analysis indicated that the effect on our income before income taxes would not be significant.
Item 8. Financial Statements and Supplementary Data
The financial statements, together with the report thereon of PricewaterhouseCoopers LLP dated February 14, 2014, and the Selected
Quarterly Financial Data (Unaudited), are set forth in Item 15 of this 2013 10-K Report.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
None.
Item 9A. Controls and Procedures
Management’s Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports
that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in
the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief
Executive Officer (‘‘CEO’’) and our Chief Financial Officer (‘‘CFO’’), as appropriate, to allow timely decisions regarding required financial
disclosure.
As of the end of the period covered by this report, we evaluated, under the supervision and with the participation of our CEO and CFO,
the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(e).
Based upon this evaluation, the CEO and CFO concluded that our disclosure controls and procedures were effective at a reasonable
assurance level as of December 31, 2013.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is
defined in Exchange Act Rule 13a-15(f). Our internal control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles in the United States of America. Our internal control over financial reporting includes
those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles in the United States of America, and
that receipts and expenditures are being made only in accordance with authorizations of management and our directors; and
(iii) provide reasonable assurance regarding prevention or timely detection of the unauthorized acquisition, use or disposition of assets
that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
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