2009-10 Annual Report - Australia Post

29 Financial and capital risk management (continued)
(g) Commodity price risk management (continued)
Commodity price sensitivity
there were fuel swap contracts in place during the years ended 30 June 2009 and 30 June 2010 which matured prior to reporting date; hence the
sensitivity analysis on profit after tax and equity as at 30 June 2009 and 30 June 2010 is not representative of the commodity price risk inherent
in the use of fuel swap contracts during the current and prior year.
the following table details the commodity contracts outstanding as at balance date.
Buy barrels
0–6 months
7–12 months
corporation and consolidated
2010 2009
exposure
amount
(Aud) $m
9.8
10.3
exposure
amount
(aud) $m
AustrAliA Post AnnuAl rePort 2009–10 | Financial and statutory reports 89
–
–
20.1 –
all commodity swap contracts are entered into on the basis of known or projected exposures. the corporation has elected to adopt cashflow hedge
accounting in respect of some of its commodity hedging activities. the fair value of commodity swap contracts designated as hedging instruments
is a liability of $0.5 million (2009: $nil) for the corporation and the group. the portion of the gain or loss on the designated commodity swap contracts
that are determined to be effective hedges are deferred and will be recognised in the measurement of the underlying transaction.
as at balance date, the aggregate amount of unrealised gains/losses under commodity swap contracts deferred in the hedging reserve related
to contracted future payments for fuel expenses. it is anticipated that the payments will take place within 12 months after reporting date, at which
stage the amount deferred in equity will be reclassified as an expense.
the following table details the effect on profit and equity after tax as at 30 June from a 14% favourable/unfavourable change in the fuel
price with all other variables held constant. the sensitivity analysis below has been determined based on the exposure to fuel from financial
instruments at the reporting date and the stipulated change taking place at the beginning of the financial year and being held constant throughout
the reporting period.
a positive number indicates an increase in profit or equity after tax, while a negative number indicates a reduction in profit or equity after tax.
impact on profit after tax at reporting date, with all other variables held constant of a:
14% increase in fuel prices
14% decrease in fuel prices
impact on equity after tax at reporting date, with all other variables held constant of a:
14% increase in fuel prices
14% decrease in fuel prices
corporation and consolidation
2010
$m
0.8
(0.8)
1.2
(1.2)
2009
$m
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–
–
–