LEGO-Group-Annual-Report-2017.pdf

Derivative financial instruments measured at fair

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Derivative financial instruments Measured at fair value through the income statement 55 55 55 55 Measured at fair value through comprehensive income (cash flow hedging) 157 157 157 157 212 212 212 212 Total financial liabilities 6,980 6,980 6,206 683 142 7,031 Measured at amortised cost (loans and receivables) Trade receivables 7,174 7,174 7,174 7,174 Other receivables 1 642 642 642 642 Receivables from related parties 4,350 4,350 4,350 4,350 Cash at banks 906 906 906 906 13,072 13,072 13,072 13,072 Derivative financial instruments Measured at fair value through the income statement 8 8 8 8 Measured at fair value through comprehensive income (cash flow hedging) 55 55 55 55 63 63 63 63 Total financial assets 13,135 13,135 13,135 13,135 1 Non-contractual items such as taxes, duties payable and wage related payables are excluded from other receivables and other debt balance as this analysis is only required for financial instruments. 46 Notes The LEGO Group — Annual Report 2017
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Note 27. Derivative financial instruments Total hedging activities The LEGO Group uses a number of forward contracts and options to hedge currency exposure. The hedging activities are categorised into hedging of forecast transactions (cash flow hedges), and hedging of assets and liabilities (fair value hedges). The changes in fair value of the financial instruments qualifying for hedge accounting are recognised directly under comprehensive income until the hedged items affect the income statement. The changes in fair value of the financial instruments not qualifying for hedge accounting are recognised directly in the income statement. This includes time value of options. All changes in fair value of hedging of assets and liabilities (fair value hedging) are recognised directly in the income statement. Financial assets and liabilities measured at fair value concern derivative financial instruments. The calculation of fair value of the LEGO Group’s derivative financial instru- ments is based on observable inputs like interest rates etc. (level 2) as per the IFRS Fair Value Hierarchy listed below: Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1). Inputs other than quoted prices included within level 1 that are observable for the assets or liabilities, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2). Inputs for assets or liabilities that are not based on observable market data (that is, unobservable inputs) (level 3). Note 26 (continued) 47 Notes The LEGO Group — Annual Report 2017
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Note 27 (continued) 2017 (mDKK) Contract amount Positive fair value Negative fair value Period covered Hedging of forecast transactions qualifying for hedge accounting USD (sale of currency) 497 29 8 months GBP (sale of currency) 147 1 1 10 months Other (sale of currency) 213 4 9 months Total forward contracts 857 34 1 USD (sale of currency) 124 9 3 months GBP (sale of currency) 42 1 4 months Total currency options 166 10 Hedging of balance items qualifying for hedge accounting USD (sale of currency) 173 16 1 2 months
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