ARTA Annual Report 2009 - Auckland Transport

TRANSPORT GRANTS
PAYABLE
Fair values
2009 $000
Fair values
2008 $000
Amt payable
2009 $000
Amt payable
2008 $000
07/08 0 0 0 0
08/09 – current 19,819 18,802 19,819 18,802
09/10 – non- current 1,152 8,470 1,152 9,880
10/11 – non-current 0 0 0 0
10 Financial Instrument Risks
ARTA and the ARC have a series of policies to manage the risks associated with financial instruments. ARTA
is risk averse and seeks to minimise exposure from its treasury activities. ARTA outsources its treasury
management to the ARC under the Support Services Agreement and has established a treasury policy. This
policy does not allow any transactions that are speculative in nature to be entered into.
Section 3.1 of the rules of ARTA prevent ARTA from entering into any material transaction (including any
transaction that has or is likely to have the effect of ARTA acquiring rights or incurring obligations which
are likely to have a material adverse effect on the financial performance or position of the ARC) without the
prior written approval of the ARC.
Market Risk
- Interest Rate Risk
Fair value interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes
in market interest rates.
Borrowings and investments listed at fixed rates of interest expose ARTA to fair value interest rate risk.
ARTA currently has no fixed rate borrowings or investments.
Cash flow interest rate risk is the risk that cash flows from a financial instrument will fluctuate because of
changes in market interest rates.
Borrowings and investments issued at variable interest rates expose ARTA to cash flow interest rate.
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