Annual Report 2000 in PDF - Antofagasta plc

Notes to the Financial Statements19 Financial Instruments and Risk Management (continued)g) Concentration of credit risk and credit exposure of financial instrumentsThe Group is exposed to losses in the event of non-performance by counter-parties to financial instruments, but doesnot expect any counter-parties to fail to meet their obligations. There are no outstanding interest rate swaps or zerocost collar agreements at 31 December 2000 (1999 – the Group had a maximum credit exposure of US$163.0 million(£101.2 million) to one counter-party under interest rate swap and zero cost collar agreements). The Group does notnormally see the need to seek collateral or other security.h) Fair value of financial instrumentsThe fair values of financial instruments are the amount at which the instruments could be exchanged in an arm’s lengthtransaction between informed and willing parties, other than in a forced or liquidation sale. The book values are includedin the Group balance sheet under the indicated headings, with the exception of derivative amounts, which are includedin debtors and creditors as appropriate. The book and fair values of the Group’s financial instruments are as follows:US DollarsBook value Fair value Book value Fair value2000 2000 1999 1999US$m US$m US$m US$mFinancial assetsOther investments 185.5 256.9 185.8 412.0Current asset investments and cash at bank and in hand 300.1 300.1 331.6 331.6Debtors due after one year 6.5 6.5 2.3 2.3492.1 563.5 519.7 745.9Financial liabilitiesOther creditors due after one year (28.5) (28.5) – –Short term loans (92.2) (92.2) (64.8) (64.8)Long term loans (1,003.5) (1,003.3) (1,006.3) (1,005.7)Preference shares (3.0) (2.4) (3.2) (2.6)Severance indemnities provision (8.9) (8.9) (7.2) (7.2)Hedging instruments – interest – – (1.0) (1.0)Hedging instruments – copper – – (0.9) (0.9)Hedging instruments – foreign currency – – (0.1) (0.1)ANTOFAGASTA PLC Annual Report 2000(1,136.1) (1,135.3) (1,083.5) (1,082.3)66