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98
Hamon Annual Report 2010
Forward currency contracts used to hedge the transactional
risks on currencies are accounted as if they were held
for trading.
However, such forward currency contracts are only used
to hedge existing transactions and commitments and are
therefore not speculative by nature.
The fair values were directly recognized in the income
statement in unrealized exchange gains or losses.
37. FINANCIAL INSTRUMENTS
Financial Assets and Liabilities
in EUR ‘000’ 31/12/10 31/12/09 31/12/08 Hierarchy of
fair values
Financial Assets
Cash and cash equivalents 68 077 83 253 59 089 Niveau 1
Available-for-sale financial assets 6 632 2 421 1 627 Niveau 2
Loans and receivables 97 632 83 681 102 888 Niveau 2
Derivative financial assets 16 230 14 309 62 886 Niveau 1
188 571 183 664 226 490
Financial Liabilities
Borrowings at amortized cost 80 953 75 065 69 858 Niveau 1
Other payables 66 551 56 569 58 181 Niveau 2
Derivative financial liabilities 16 101 13 924 64 049 Niveau 1
163 605 145 558 192 088
Fair value and book value
In order to show the importance of data’s used for the
valuations of fair values, the Group classifies these
valuations according to a hierarchy that includes the
following levels:
■ Level 1 fair value measurements are those derived
from quoted prices (unadjusted) in active markets for
identical assets or liabilities;
■ Level 2 fair value measurements are those derived
from inputs other than quoted prices included within
Level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived
from prices); and
■ Level 3 fair value measurements are those derived
from valuation techniques that include inputs for the
asset or liability that are not based on observable
market data (unobservable inputs).
Financial assets are mostly current. Their fair value thus
does not differ from their book value. Their book value
already takes into account possible provisions when the
collection seems compromised. Available-for-sale
financial assets are made on the one hand, of our share
in GEI, valued at stock market price on 31 December,
and on the other hand of investments in various small
companies not quoted on the stock market and valued
at their acquisition value. Their fair value is higher than
their acquisition value but given the fact that the impact
is minimal, no correction has been accounted for.
Non-current financial liabilities were evaluated at
amortized cost; which is net of transaction costs.
Borrowings principally include the syndicated debt for
which the fair value is comparable to the value in the
accounts. “Other payables” are mainly trade payables
for which the fair value does not differ from the book
value due to its current nature.
Financial instruments indicated in the table include
Interest Rate Swaps (IRS) in 2008, and forward currency
contracts. These last ones are included in this note on
the asset and liability sides for their notional amount
corrected by their fair value at the asset and liability
side depending whether they are positive or negative.