Annual Report 2008 - Securitas

AccOUNTS rEcEIvABLE AND AGEING ANALySIS
MSEK 2008 % 2007 % 2006 %
Accounts receivable
before deduction of
provison for bad
debt losses 10,317.0 100 10,213.7 100 9,152.6 100
Provision for bad
debt losses –354.4 –3 –324.3 –3 –297.0 –3
Total accounts
receivable 9,962.6 97 9,889.4 97 8,855.6 97
Ageing of accounts
receivable before
deduction of provision
for bad debt losses
Overdue 1–30 days 1,584.9 16 1,460.9 14 1,223.1 14
Overdue 31–90 days 726.8 7 692.9 7 487.6 5
Overdue >90 days 488.3 5 560.6 6 396.8 4
Total overdue 2,800.0 28 2,714.4 27 2,107.5 23
The following details the credit quality of non-trade receivables.
cOUNTErPArTIES wITH EXTErNAL crEDIT rATINGS
MSEK 2008 2007 2006
Credit quality non trade receivables
P1 2,921 4‚894 2,222
The Group has policies in place that limit the amount of credit exposure to
any one financial institution. Investments of liquid funds may only be made
in government paper or with financial institutions with a high credit rating.
As of December 31, 2008 the weighted average credit rating of these institutions
was short-term A1/P1. The largest total exposure for all instrument
types to any one institution was MSEK 1,292. Derivative contracts are only
entered into with financial institutions with a credit rating of at least A1/P1,
and with whom Securitas has an established customer relationship.
Rating
In order to access international debt capital markets in an effective manner,
Securitas has obtained long-term and short-term credit ratings from Standard
& Poor’s. The long term rating is BBB+ with “Stable Outlook” and the
short term rating is A-2. The Nordic short-term rating is K-1.
Fair value of financial instruments
The methods and assumptions used by the Group in estimating the fair
value of the financial instruments are:
• Cash and bank deposits and Short-term investments: carrying amounts
approximate fair values.
• Derivative and other financial instruments: fair values are estimated based
on quoted market prices, on prices provided by independent brokers, or
are calculated on best market prices. The prices used are clean prices,
that is the fair values stated excluding accrued interest.
• Debt: fair values are estimated using discounted cash flow calculations
based upon the Group’s current incremental borrowing rates for similar
types of borrowings with maturities consistent with those remaining for
the debt being valued.
rEvALUATION OF FINANcIAL INSTrUMENTS
MSEK 2008 2007 2006
Recognized in the statement of income
Financial income 1 2.7 – –
Financial expenses – –6.7 –35.8
Deferred tax –0.8 1.9 10.0
Impact on net income for the year 1.9 –4.8 –25.8
Recognized via statement
of recognized income and expense
Transfer to hedging reserve before tax –183.3 4.6 30.6
Deferred tax on transfer to hedging reserve 51.3 –1.3 –8.6
Transfer to hedging reserve net of tax –132.0 3.3 22.0
Transfer to statement of income before tax 2.4 –33.1 –11.0
Deferred tax on transfer to statement of income –0.6 9.3 3.1
Transfer to statement of income net of tax 1.8 –23.8 –7.9
Total change of hedging reserve before tax 2 –180.9 –28.5 19.6
Deferred tax on total change of hedging
reserve before tax 2 50.7 8.0 –5.5
Total change of hedging reserve net of tax –130.2 –20.5 14.1
Total impact on shareholders’ equity
as specified above
Annual report
Notes and comments to the consolidated financial statements
Total revaluation before tax 3 –178.2 –35.2 –16.2
Deferred tax on total revaluation 3 49.9 9.9 4.5
Total revaluation after tax –128.3 –25.3 –11.7
1 Total revaluation of financial instruments 2008 amounts to MSEK 2.7, of which MSEK 1.8 relates to
ineffectiveness in fair value hedges and MSEK 0.9 relates to financial assets and financial liabilities at fair
value through profit or loss.
2 Total of transfer to hedging reserve and transfer from hedging reserve to statement of income.
3 Total revaluation and deferred tax recognized via statement of income and via statement of recognized
income and expense.
Securitas Annual report 2008
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