Financial Information - Uralita

ANNUAL REPORT 2006
FINANCIAL INFORMATION
financial asset or a non-financial liability, the
gains and losses previously deferred in equity
are transferred from equity and included in the
initial measurement of the cost of the asset or
liability. However, for hedges where the asset or
liability are not recognized, the amounts
previously recognized in equity are transferred to
the income statement in the same period in
which the hedged item affected net results.
months from the balance sheet date as noncurrent.
Loans repayable in the short term whose longterm
financing is assured at the Company’s
discretion via available long-term credit facilities
are classified as non-current liabilities.
4.11. Post-employment benefits
Changes in the fair value of derivatives that are
designated and qualify as fair value hedges are
recorded in profit or loss immediately, together
with any changes in the fair value of the hedged
item that is attributable to the hedged risk.
Uralita, S.A. and some of its Spanish
subsidiaries have undertaken commitments in
respect of supplementary post-retirement
benefits for certain groups of retired or disabled
employees and under other captions.
Hedge accounting is discontinued when the
hedging instrument expires or is sold, terminated
or exercised, or no longer qualifies for hedge
accounting. Any accumulated gains or losses on
the hedging instrument remain in equity until the
forecast transaction occurs. When the
transaction is no longer expected to occur, the
cumulative gain or loss that was deferred in
equity is transferred to profit or loss.
4.10. Classification of current and non-current
In the accompanying consolidated balance
sheet, financial assets and liabilities are
classified according to their maturity. Those due
to be settled in 12 months or less are classified
as current and those due to be settled after 12
The Spanish companies have arranged external
coverage for these commitments with non-Group
Spanish insurance companies. These defined
contribution contracts provide full payment of
the benefits at no additional cost to the
companies, except, in the case of Uralita, S.A.,
expenses arising from changes in estimated
salary and social security pension variables.
For foreign subsidiaries, the amounts considered
sufficient to meet the commitments accrued at
31 December 2006 are recorded on the
liabilities side on the balance sheet at that date
under “Provisions” (see Note 12). The liabilities
are estimated by actuarial valuation methods,
with the gains and losses recognized as income
or expense in the year.
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