Singapore Press Holdings annual report 2011 Singapore Press ...

Notes to the
Financial StatementS
August 31, 2011
152 Singapore Press Holdings annual report 2011
31. FINANCIAL RISK MANAGEMENT (CONT’D)
The policies for managing these risks are summarised below.
(a)
Market risk
(i)
Currency risk
The currency risk of the Group arises mainly from its operational purchases of raw materials
and consumable stores and capital expenditure denominated in currencies other than the
functional currency. In addition, currency risk also arises from the Group’s foreign currency
investments and from costs incurred by its overseas news bureaus. The Group also has
investments in foreign subsidiaries, associates and jointly-controlled entities, whose net
assets are exposed to currency translation risk.
Where appropriate, the Group enters into foreign exchange forward contracts and cross
currency swaps to hedge against its currency risk resulting from anticipated sale and purchase
transactions in foreign currencies, its foreign currency denominated investments and net
assets of its foreign subsidiaries, associates and jointly-controlled entities.
The Group’s currency exposure on its monetary financial assets and liabilities based on the
information provided to key management is as follows:
2011
SGD USD CNH Others Total
S$’000 S$’000 S$’000 S$’000 S$’000
Financial assets
Trade and other receivables 140,069 1,203 - 9,190 150,462
Short-term investments 223,675 5,002 - - 228,677
Cash and cash equivalents 340,023 2,079 39,802 10,610 392,514
703,767 8,284 39,802 19,800 771,653
Financial liabilities
Trade and other payables (274,523) (13,191) - (7,288) (295,002)
Borrowings (1,109,537) - - (2,431) (1,111,968)
(1,384,060) (13,191) - (9,719) (1,406,970)
Net financial
(liabilities)/assets (680,293) (4,907) 39,802 10,081 (635,317)
Less: Net financial
liabilities/(assets)
denominated in
the respective
entities’ functional
currencies 680,293 - - (3,607) 676,686
Less: Firm commitments in
foreign currencies - (616) - (235) (851)
Less: Currency forwards - (80,751) (39,980) (261) (120,992)
Cross currency swap - (4,809) - - (4,809)
Currency exposure - (91,083) (178) 5,978 (85,283)