Notes to the financial statements
Year ended 31 March 2016
31 Financial risk management (continued)
Total return
Unitholders’ funds
100 bp 100 bp 100 bp 100 bp
increase decrease increase decrease
$’000
$’000
$’000
$’000
Trust
2016
Fixed rate instruments
Loans and borrowings
– Finance costs
(4,229)
4,229
–
–
Collateral loan
– Finance costs
(3,000)
3,000
–
–
Variable rate instruments
Loans and borrowings
– Finance costs
(22,093)
22,093
–
–
Interest rate swaps
– Finance costs
9,682
(9,682)
–
–
– Change in fair value
14,529 (14,529)
–
–
Cross currency swaps
– Change in fair value
(26,374)
26,374
–
–
(31,485)
31,485
–
–
2015
Fixed rate instruments
Loans and borrowings
– Finance costs
(3,191)
3,191
–
–
Collateral loan
– Finance costs
(3,000)
3,000
–
–
Variable rate instruments
Loans and borrowings
– Finance costs
(20,373)
20,373
–
–
Interest rate swaps
– Finance costs
11,382
(11,382)
–
–
– Change in fair value
24,574
(24,574)
3,244
(3,244)
Cross currency swaps
– Change in fair value
(4,290)
4,290
–
–
5,102
(5,102)
3,244
(3,244)
Market price risk
Market price risk arises from the Group’s ECS and Trust’s collateral loan which are accounted for as a financial liability
at fair value through profit or loss. The fair value of the collateral loan is determined based on the method described in
Note 33. Changes in the market price of the ECS will result in changes in the fair value of the collateral loan. As at the
reporting date, a 1% increase in the ECS market price will result in a decrease on the total return (before any tax effects)
of the Group and the Trust of $3,540,000 (2015: $3,660,000). A 1% decrease in the market price of the ECS would have
an equal but opposite effect on the total return of the Group and the Trust. The analysis was performed on the same basis
for 2015 and assumes that all other variables remain the same.
.204
A-REIT ANNUAL REPORT
2015/2016
