EFTA01367200.pdf

Amendment #4 Page 771 of 868 1:01.7 OccOlit• 4.7 Derivative financial instruments and hedge accounting 4.7.1 Initial recognition and subsequent measurement The Company triesderrative financial Instruments, interest rate swaps and caps, to hedge the risk of interest rate fluctuations and does not hold a issue dermreve finance' instrumerts fa tracing purposes Such derradne financial ristnrnents are meetly recognzed at far value on the date on which a derivabve contract is ottanect and are subsequently re-ineaSured at tat value Derivatives are corned as financial assets yawn the far value is pests* and as finance' babilites when the far value is negative. The far value of an interest rate swap/cap is the estimated amotrt that the Company would receive a pay to ternsrete the swapkap on the date O the statement of financial position. taking no account current interest rates and the payment capacity of the counterpanes Ctenges in fair value of the Company's derivage financial retrumerts that quality for hedge accounting are recognaed as fotows Oranges in the time value of instruments and any ineffectneness are taken directly to the income statemert while changes in the irtnnsc value are recognized as pert of Other comprehensive income For hedge accountng purposes, the Company's ireerest rate swept/caps are classified as cash flow hedges/lithe beginning date of a hedge agreement, the Company formally deagnateS and documents the hedge retatiOntJipt0 which the Company wishes to apply hedge accoutreno and the risk management objectors and strategy for isdereking the hedge The doumentation includes identification of the hedging nstrument the hedged tern or transaction, the nature of the nsk being hedged and how the entty vet assess the hedging inalninent's effectiveness n ofbeterg the exposure to changes In the hedged item's cash eon attributable to the hedged risk Such hedges are expected to be highly elective in achieving olfsettng charges in cash flaws and are assessed on a quarterly tens to determine that they actually have been highly effective throughout the finanoal reporting percds for which they were designated Cash few hedges which meet We strict ornate for hedge accounting are recorded as follows. a) to effective portion of the gain or loss on the hedging instrument is recognized directly in equity, widen other comprehensive ircome, while any ineffedive porton is recognized immediate/ in the income statement; b) amounts tales to equity are transferred to the income statement when the hedged transaction affects profit or loss, such as when the hedged enamel ircome or Marcel expense is recognized or when a forecast sale occurs II the hedging instrument no longer meets the cntena for hedge accenting, expres or is sold. termnated or exercised, then the hedge accounting is discontinued. The cumulative gain or loss previously recognized in equity remains there until the forecast transactors occurs 0.7.2 Current versus non-current classification ()enviere instruments that are designated as hedges, and are effective hedging inetnenents. are dassded consistently wan the classification of the Lnderlying hedged nem The (*wane iron/nerd is separated into a current portion and a non-curent portion only it a resatse altacabon can be made 42 Inventory 4.8.1 Spare parts inventory inventories are vaItted at the lower of cast and net realizable valve on a weighted average bass F-451 http://cfdocs.btogo.com:27638/cf/drv7/pub/edgar/2015/07/20/0001193125-15-256461/d78... 7/20/2015 CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0058728 CONFIDENTIAL SDNY_GM_00204912 EFTA01367200