NOTES TO THE FINANCIAL STATEMENTS
24. Equity:// CONTINUED
24.4 Reserves Hedge reserves
Hedge reserves comprise the cash flow hedge reserve and cost of hedging. The cash flow hedge reserve records the effective portion of changes in the fair value of interest rate swaps that are designated as cash flow hedges. The gain or loss relating to the ineffective portion is recorded in profit or loss within interest costs (net). During the year, $59.5 million (2016: $50.2 million) was transferred from the cash flow hedge reserve to interest expense. Cost of hedging records the change in the fair value of the cost to convert foreign currency into New Zealand dollars as required under NZ IFRS 9. Other reserves comprise: —— A share-based payment reserve relating to the employee share purchase scheme. When shares are vested to the employee, the reserve is offset with a reduction in treasury shares. —— A foreign currency translation reserve to record exchange differences arising from the translation of the group’s foreign operations. —— A reserve recording the group’s share of its associates other comprehensive income. —— A reserve to record the fair value movements in the group’s investments in financial assets.
Other reserves
114
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