english - About Heraeus
english - About Heraeus
english - About Heraeus
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addition, credit lines with various banks ensure an adequate supply of liquid funds. Risk<br />
concentrations are minimized on the basis of investment limits with individual selected<br />
banks with a good level of creditworthiness.<br />
The risk of liquidity shortages is monitored by Corporate Treasury. Effective cash management,<br />
as well as the ability to fall back on sufficient liquidity, even during times of crisis,<br />
minimizes the risk that <strong>Heraeus</strong> will not be able to meet its financial obligations.<br />
Value-at-risk<br />
In the past, the management decided to measure significant market price risks resulting<br />
from financial instruments in accordance with the value-at-risk (VaR) method and to have<br />
a report on these risks created on a monthly basis within the treasury report. Value-at-risk<br />
figures are calculated on the basis of a historical simulation. The 250 business days preceding<br />
the closing date are used as the basis of calculation. The historical simulation is a<br />
non-parametric method that uses historical market price changes directly to value the<br />
current portfolio.<br />
The calculation of value-at-risk takes into account exchange rate risks resulting from financial<br />
instruments within the meaning of IFRS 7 only if financial instruments were concluded<br />
in a different currency from the functional currency of the reporting unit in question. Currency<br />
risks that result from the conversion of the individual financial statements of the subsidiaries<br />
into the Group reporting currency, known as “translation risks,” are not taken into<br />
consideration for this purpose.<br />
Portfolios Value-at-risk Value-at-risk<br />
in € million deC. 31, 2012 deC. 31, 2011<br />
Currency risk 23.2 16.1<br />
Securities risk 3.2 3.5<br />
The value-at-risk represents the loss that will not be exceeded with a holding period of<br />
ten days with a 99% probability.