Page 106 - Forterra

104 FORTERRA
ANNUAL REPORT 2012
NOTES TO THE
FINANCIAL STATEMENTS
28 FINANCIAL RISK MANAGEMENT (CONTINUED)
(d) Interest rate risk (Continued)
Fair value sensitivity analysis for fixed rate instruments
The Group does not account for any fixed rate financial assets and liabilities at fair value
through profit or loss, and the Group does not designate derivatives as hedging instruments
under a fair value hedge accounting model. Therefore, a change in interest rates at the
reporting date would not affect the profit or loss.
Cash flow sensitivity analysis for variable rate instruments
For variable rate loans and borrowings, it is estimated that an increase of 100 basis points
(bp) in interest rate at the reporting date would increase/(decrease) profit or loss (before
any tax effects) by the amounts shown below. This analysis assumes that all other variables,
in particular foreign currency rates, remain constant.
Profit or loss
$’000
Group
As at 31 December 2012
Cash and cash equivalents 396
Variable rate interest-bearing borrowings (8,591)
(8,195)
As at 31 December 2011
Cash and cash equivalents 258
Variable rate interest-bearing borrowings (8,553)
(8,295)