Registration document 2007 - Total.com

The non-current debt in dollars described in note 20 to the
consolidated financial statements page 209 is generally raised by
the corporate treasury entities either in dollars or in euros, or in
other currencies which are then systematically exchanged for
dollars or euros according to the general corporate purposes,
through issue swaps. The proceeds from these debt issuances
are principally loaned to affiliates whose accounts are kept in
dollars and any remaining balance is held in dollar-denominated
investments. Thus, the net sensitivity of these positions to
currency exposure is not material.
The Group’s short-term currency swaps, the nominal amounts of
which appear in note 27 to the consolidated financial statements
(page 222), are used to attempt to optimize the centralized cash
management of the Group. Thus the sensitivity to currency
fluctuations which may be induced is likewise considered
negligible.
As a result of this policy, the impact of currency exchange on
consolidated income, as illustrated in note 7 to the consolidated
financial statements (page 194), has not been significant over the
last three years despite the considerable fluctuation of the dollar
(loss of 30 M€ in 2006, gain of 76 M€ in 2005, loss of 75 M€ in
2004).
Liquidity risk
Counterparty risk
The Group has established standards for market transactions
according to which bank counterparties must be approved in
advance, based on an assessment of the counterparty’s financial
soundness and its rating (Standard & Poors, Moody’s), which
must be of high quality.
An overall authorized credit limit is set for each bank and is
divided among the subsidiaries and the Group’s central treasury
entities according to their needs.
Stock market risk
Risk Factors
Market risks
4
The Group holds interests in a number of publicly-traded
companies (see note 13 to the consolidated financial statements,
page 200). The market value of these holdings fluctuates due to
various factors, including stock market trends, valuations of the
sectors in which the companies operate, and the economic and
financial condition of each individual company.
TOTAL S.A. has confirmed lines of credit granted by international banks, which are calculated to allow it to manage its short-term liquidity
needs as required (see page 70).
The following tables show the maturity of the financial assets and debts of the Group as of December 31, 2006 and 2005 (see note 20 to
the consolidated financial statements, page 209).
ASSETS/(LIABILITIES)
As of December 31, 2006 (in M€) Less than Between 1 and More than
1 year 5 years 5 years Total
Financial debt after swaps (2,025) (10,733) (2,955) (15,713)
Cash and cash equivalents 2,493 - - 2,493
Net amount 468 (10,733) (2,955) (13,220)
As of December 31, 2005 (in M€) Less than Between 1 and More than
1 year 5 years 5 years Total
Financial debt after swaps (3,619) (9,057) (4,259) (16,935)
Cash and cash equivalents 4,318 - - 4,318
Net amount 699 (9,057) (4,259) (12,617)
TOTAL – Registration Document 2006 79