annual Report 2009 - STRATEC Biomedical AG

Report of the board of Management
Report of the supervisory board
THE share
Corporate Governance
Group Management report
Consolidated financial statements
Service
Risk management
Principles of risk management
The assets, liabilities and future activities of STRATEC AG are subject to risks resulting from changes in exchange rates,
interest rates and stock market prices. The objectives and methods used by the STRATEC Group to deal with the financial
risks listed below form the object of the Group’s risk management activities. The principles underlying the Group’s risk
management policies are presented in the “Risk Report” section of the group management report.
The objective of financial risk management is to limit these risks primarily by means of operating activities. These measures
are supplemented by finance-based measures. The primary objective is to limit the risks of relevance to the cash flow.
The basic principles of the company’s financial policy are reviewed by the Board of Management annually and revised
to account for new developments. The Supervisory Board is informed at regular intervals of the financial position of the
Group and the assessments made by the Board of Management.
The financial instruments reported in the accounts could in principle give rise to the following risks for the company:
Foreign currency risks
STRATEC AG may be exposed to foreign currency risks as a result of its investments, financing measures and operating
activities.
These risks have not been secured to date, since they only affect the cash flow of the Group to an immaterial extent.
These risks mainly relate to the translation of the financial statements of foreign group companies into the group reporting
currency (u). Exchange rate volatility thus affects consolidated earnings, as well as the Group’s equity due to the allocation
of translation differences to the currency reserve in equity. Since the foreign group companies enjoy a high degree
of autonomy within their respective functional currency areas in terms of their operating and financial activities, fluctuations
in exchange rates effectively do not present any significant liquidity risk for the Group.
By analogy with the foreign companies, the parent company also performs the predominant share of its operating activities
in its functional currency (u). The foreign currency risk faced by the STRATEC Group on account of its operating
activities is therefore classified as low.
To present market risks, IFRS 7 requires companies to perform sensitivity analyses portraying the impact of hypothetical
changes in the relevant risk variables on their earnings and equity. The implications for the period under report are determined
by applying these hypothetical changes in variables to the volumes of financial instruments held at the balance
sheet date.
The analysis of the hypothetical impact of exchange rate movements on consolidated earnings and group equity as a result of
the translation of the financial statements of foreign group companies has been based on the following assumptions:
Annual average rate
Reporting date rate
GBP CHF GBP CHF
Actual figures in 2009 0.89 1.51 0.89 1.48
- 10 % (depreciation in EUR compared with CHF/GBP) 0.80 1.36 0.80 1.33
+ 10 % (appreciation in EUR compared with CHF/GBP) 0.98 1.66 0.98 1.63
Actual figures in 2008 0.80 1.59 0.95 1.49
- 10 % (depreciation in EUR compared with CHF/GBP) 0.72 1.43 0.86 1.34
+ 10 % (appreciation in EUR compared with CHF/GBP) 0.88 1.75 1.05 1.64
stratec Annual Report 2009
103