NATS-Annual-Report-2015

Annual Report and Accounts 2015 | NATS Holdings Limited
Financial Statements 120
Notes forming part of the
consolidated accounts
(continued)
19. Financial instruments (continued)
Foreign currency sensitivity analysis
The group holds foreign currency cash balances of £4.8m at 31 March 2015 (2014: £5.3m) in euro, US dollars, Canadian dollars, Kuwaiti
dinar, Norwegian krone and UAE dirham.
The following table details the group’s sensitivity to a 10% increase or decrease in the value of sterling against relevant foreign
currencies. 10% is the sensitivity rate that represents the reasonably possible change in foreign currency exchange rates in a financial
year. The sensitivity analysis includes foreign currency cash balances, trade receivables, trade payables and forward foreign exchange
contracts and adjusts their translation at the period end for a 10% change in foreign currency rates.
The table below shows the effect of a 10% strengthening of sterling against the relevant currency (to the nearest £0.1m). A positive
number below indicates an increase in profit and equity and a negative number a reduction in profit and equity. There would be an equal
and opposite impact on profit and equity if sterling devalues by 10% against the relevant currency.
2015 2014
Impact
Impact
Currency £m £m
Euro 4.3 6.3
Canadian dollar - (0.3)
US dollar (0.1) -
UAE dirham (0.1) -
Qatari riyal - (0.2)
4.1 5.8
The group’s sensitivity to the euro decreased during the year reflecting a net increase in euro monetary assets and a net increase
in euro denominated forward contracts taken out to hedge future receipts. Exposure to other currencies has remained fairly constant.
NATS believes that this sensitivity analysis accurately reflects its inherent foreign exchange risk.
Financial
Statements