Notes to the financial statements (continued) Section 4: Debt and equity (continued) 20. Derivative financial instruments (continued)
where the hedged item results in the recognition of a non-financial asset (such as inventories or property plant and equipment), or re-classified to profit or loss in the same reporting year the hedged item affects the profit or loss. When a hedging instrument expires, is sold or is terminated, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity, and is recognised when the forecast transaction occurs. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately re-classified to profit or loss. iii. Derivatives that do not qualify for hedge accounting For all derivative transactions that do not qualify for hedge accounting, any changes in fair value are recognised immediately in profit or loss. During the reporting year ended 30 June 2025, all Western Power’s derivative transactions qualified for hedge accounting (30 June 2024: all qualified). iv. Derecognition Derivative financial instruments are derecognised when Western Power no longer controls the contractual rights that comprise the financial instrument. During the reporting year ended 30 June 2025, Western Power did not derecognise any derivative financial instruments (30 June 2024: nil derecognised). B. Amounts recognised in statement of financial position See table 48 below.
A. Accounting policy (continued) ii. Hedge accounting (continued) Fair value hedges
For all derivative transactions designated as a fair value hedge, the portion of gain or loss on the hedging instrument is recognised in profit or loss, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. There is no impact in other comprehensive income or the hedging reserve. During the reporting year ended 30 June 2025, Western Power had not accounted for any derivative financial instruments that qualified for hedge accounting as fair value hedges For all derivative transactions designated as a cash flow hedge, the portion of gain or loss on the hedging instrument that is determined to be an effective hedge is recognised in other comprehensive income and accumulated in the hedging reserve. The ineffective portion is recognised in profit or loss immediately. When the cash flows occur, the amounts accumulated in the hedging reserve are either transferred to the carrying value of the asset, (30 June 2024: nil). Cash flow hedges
Table 48: Amounts recognised in statement of financial position
2024/25 Non- current $M
2023/24
Non- current $M
Current $M
Total $M
Current $M
Total $M
Note
Assets Interest rate swaps
20(b)(i)
- -
5 5
5 5
- -
29 29
29 29
Liabilities Interest rate swaps Forward domestic borrowing commitments
20(b)(i)
- 8
20 -
20 8
- -
- -
- -
8
20
28
-
-
-
Western Power Annual Report 2025
123
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