33
None of the investees of Atresmedia Corporación de Medios de Comunicación, S.A. are listed on
Spanish or foreign stock exchanges.
At the end of each year or period the directors assess the business plans of the Company’s
investees, revise them if necessary and estimate the value of the ownership interests and the
recoverability of the investmentsmade.
For investments for which business plans are not available, impairment is estimated on the basis
of the company’s equity and the unrealised gains at the end of the year or period.
Impairment losses recognised in 2013 included EUR 2,572 thousand and EUR 328 thousand in
relation to the ownership interests held in Antena 3 Noticias, S.L. (Sole-Shareholder Company)
and Hola Televisión América, S.L., respectively. Also, impairment losses totalling EUR 975
thousand relating to other companies were reversed.
10.- Information on the nature and level of risk of financial instruments
The Company's financial risk management is centralised in its Financial Department, which has
established the mechanisms required to control exposure to interest rate and exchange rate
fluctuations and credit and liquidity risk. The main financial risks affecting the Company are as
follows:
a) Credit risk:
In general, the Company holds its cash and cash equivalents at banks with high credit ratings.
The advertising contracting terms enable bank guarantees to be demanded prior to the launch of
advertising campaigns. Also, it should be noted that the Company does not have a significant
concentration of credit risk exposure to third parties and no significant incidents arose in 2013.
At 31 December 2013, 2.7% of total borrowings were past-due.
In any case, the Company estimates allowances for doubtful debts based on the age of the debt.
Allowances for doubtful debts amounted to EUR 3,578 thousand at 31 December 2013 (31
December 2012: EUR 6,674 thousand) (see Note 20.4).
b) Liquidity risk:
The Company’s liquidity policy is to arrange credit lines and current financial assets that are
sufficient to support its financial needs, on the basis of expected business performance. These are
all tied to floating interest rates.
The Company, for the purpose of ensuring liquidity and enabling it to meet all the payment
obligations arising from its business activities, has the cash and cash equivalents disclosed in its
balance sheet, together with the credit and financing facilities detailed inNote 16.
c) Foreign currency risk:
Foreign currency risk relates mainly to the payments to be made in international markets to
acquire broadcasting rights, primarily frommajor production companies in the US, denominated in
US dollars. In order to mitigate this risk, the Company arranges financial instruments (mainly
foreign currency hedges) which reduce exchange differences on foreign currency transactions (see
Note 11).
d) Interest rate risk:
Both the Company's cash and its bank borrowings are exposed to interest rate risk, which could
have an adverse effect on financial profit or loss and cash flows. The Company's financing is
arranged at interest rates tied to Euribor. Tomitigate this risk, the Company has arranged interest
rate swaps to reduce the finance costs arising from the pegging to floating rates (see Note 11).
