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Notes to the Financial Statements
31 December 2015
22 DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)
The details of the derivative financial instruments are set out as below: (continued)
(b) IRS
Commencement
date
Contract/
Notional amount
2015
RM’000
2014
RM’000
Interest Rate
17 July 2012
200,000
200,000 The Group and Company pay a fixed interest rate of 3.50% per
annum in exchange for receiving KLIBOR on the notional principal
amount.
25 July 2012
500,000
500,000 The Group and Company pay a fixed interest rate of 3.43% per
annum in exchange for receiving KLIBOR on the notional principal
amount.
(c) Forward foreign exchange contracts
Commencement
date
Contract/
Notional amount
Contract value in
foreign currency
2015
RM’000
2015
USD’000
Exchange Rate
28 December 2015
43,161
10,000
The Group pays RM in exchange for receiving USD at pre
determined exchange rate of RM4.3161/USD on the notional
amount at the maturity date.
29 December 2015
56,083
13,000
The Group pays RM in exchange for receiving USD at pre
determined exchange rates that range from RM4.3112/USD to
RM4.3186/USD on the notional amounts at the maturity dates.
At the reporting date, the Group and the Company have recognised net derivative financial assets of RM777,324,000 (2014: RM228,604,000)
and RM777,101,000 (2014: RM228,604,000) respectively, an increase in fair value gains by RM548,720,000 (2014: RM200,982,000) and
RM548,497,000 (2014: RM200,982,000) respectively from the prior financial year, on remeasuring the fair values of the derivative financial
instruments for:
(i) derivative designated in hedging relationship
The increase in fair value gains from the prior financial year for the Group and the Company were RM548,563,000 (2014: RM200,982,000) and
RM548,497,000 (2014: RM200,982,000) respectively, with the corresponding movement included in equity in the cash flow hedging reserve.
For the current financial year, RM527,879,000 was reclassified to the statements of profit or loss to offset the foreign exchange losses of
RM523,717,000 which arose from the weakening RM against USD and SGD, and the interest expense of RM4,162,000 as the underlying
interest rates were higher than the hedged interest rates on the borrowings. This has resulted in an increase in the credit balance of the
cash flow hedging reserve of the Group and the Company as at 31 December 2015 by RM20,684,000 and RM20,618,000 respectively.
