Content2011 - PETRONAS Gas Berhad

Notes to the Financial Statements
31 MarCh 2011
15. Borrowings (Continued)
167 annUaL report 2011
The unsecured term loan comprising the 6th series 3.4% Samurai Bond was on lent from PETRONAS to the Company on 21 April 1997. The
term loan represents an amount equivalent to Yen 16 billion. Under the CEA with PETRONAS, the repayment of the principal amount is at a
fi xed exchange rate of 100 Yen – RM2.838. The loan is due for payment in year 2013 at contracted amount of RM454.1 million.
The CEA being an embedded derivative attached to the Yen 16 billion term loan is valued and accounted separately at each reporting
date due to the risks and characteristics not being closely related to the host contract. The term loan is translated at the spot rate at the
reporting date whereas the CEA is measured at fair value. The fair value of the CEA is based on the discounted cash fl ow of the difference
between forward exchange rate and contracted rate. Any increase or decrease in the translation or valuation is recorded accordingly in the
fi nancial statements.
The market risk on the fair value or future cash fl ows of the term loan and CEA will fl uctuate depending on the exchange rate and interest
rate movement.
For the purpose of presentation of the fi nancial statements, both the term loan and the CEA are netted off since the conditions of legally
enforceable right and the intention to settle on net basis are met.
The net unrealised gain arising from retranslation of term loan and revaluation of CEA during the year was RM14,102,000 (2010 - net
unrealised gain of RM11,943,000).
16. Deferred Tax
The components and movements of deferred tax during the fi nancial year are as follows:
As at
Charged/
(Credited)
to Profi t As at
1.4.2010 or Loss 31.3.2011
Group/Company RM’000 RM’000 RM’000
Property, plant and equipment 1,131,418 (28,940) 1,102,478
Financial instrument valuation 32,530 8,694 41,224
Deferred income (3,814) 415 (3,399)
Foreign currency translation (28,134) (5,169) (33,303)
Total 1,132,000 (25,000) 1,107,000
Charged/
(Credited)
As at to Profi t As at
1.4.2009 or Loss 31.3.2010
Group/Company RM’000 RM’000 RM’000
Property, plant and equipment 1,148,818 (17,400) 1,131,418
Financial instrument valuation 35,742 (3,212) 32,530
Deferred income (4,228) 414 (3,814)
Foreign currency translation (34,332) 6,198 (28,134)
Total 1,146,000 (14,000) 1,132,000