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Notes To The Consolidated Financial Statements
(Expressed in Renminbi)
1
/ China Communications Services Corporation Limited
43 Financial risk management and fair values
(continued)
(d) Currency risk
Foreign currency exchange rate risk arises on financial instruments that are denominated in a currency
other than the functional currency in which they are measured. The Group’s foreign currency risk
exposure relates to the bank deposits and borrowings denominated primarily in United States dollars,
Hong Kong dollars, Nigerian Naria and Saudi Arabian Riyal (see note 34).
The Group does not expect the appreciation or depreciation of the Renminbi against foreign currencies
will materially affect the Group’s financial position and result of operations because 95.7% (2010:
95.7%) of the Group’s cash and cash equivalents and 82.3% (2010: 99.9%) of the Group’s short-term
debt as at 31 December 2011 are denominated in Renminbi.
The following table details the Group’s and the Company’s exposure at the balance sheet date to
currency risk arising from recognised assets or liabilities denominated in a currency other than the
functional currency of the entity to which they related. For presentation purposes, the amounts of the
exposure are shown in RMB, translated using the spot rate at the year-end date.
Exposure to currency risk
The Group
Exposure to foreign currencies (expressed in RMB)
2011
United
Hong
Saudi
Arabian
Riyal
‘000
States
Kong Nigerian
Ethiopian
dollars dollars
Naira
Birr
Others
‘000
‘000
‘000
‘000
‘000
Cash and cash equivalents
183,552 43,930 31,083 25,475
1,765 40,494
Accounts receivable
410,216 17,311 16,186
–
69,823 180,926
Accounts payable
(358,352)
(12,714)
(12,673)
–
(689) (115,263)
Interest-bearing loans
(177,055)
–
–
–
–
–
Overall net exposure
58,361 48,527 34,596 25,475 70,899 106,157
Exposure to foreign currencies (expressed in RMB)
2010
United
Hong
Saudi United Arab
States
Kong Nigerian Arabian Emirates
dollars
dollars
Naira
Riyal
Dirham Others
‘000
‘000
‘000
‘000
‘000
‘000
Cash and cash equivalents 204,864 98,273 40,759
6,896
591
9,631
Accounts receivable
71,662 32,487
2,437
2,156 11,026
4,789
Accounts payable
(83,648)
(20,908)
–
–
(6,805)
(10,934)
Overall net exposure
192,878 109,852 43,196
9,052
4,812
3,486