KUWAIT ENERGY plc GROUP
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2012
F-107
22
.
LONG TERM PROVISIONS (CONTINUED)
b)
Retirement benefit obligation
This balance represents minor defined benefit retirement obligations relating to certain of the Group’s employees
based in Kuwait.
23.
TRADE AND OTHER PAYABLES
2012
2011
USD 000’s
USD 000’s
Trade payables
35,475
29,504
Joint venture payables and accruals
20,461
18,960
Salaries and bonus payables
5,000
4,500
60,936
52,964
Current tax payable
8,926
8,991
69,862
61,955
Trade creditors and accruals principally comprise amounts outstanding for trade purchases and on-going
costs. The average credit period taken for trade purchases is 30 days. No interest is charged on the overdue
trade payables. The Group has financial risk management policies in place to ensure that all payables are
paid within the pre-agreed credit terms.
The directors consider that the carrying amount of trade payables approximates their fair value
.
24.
DERIVATIVE FINANCIAL INSTRUMENTS
2012
2011
USD 000’s
USD 000’s
Financial liabilities carried at fair value through
profit or loss
Held for trading derivatives not designated in hedge accounting
relationships (interest rate cap - see (a) below)
484
750
The Group’s derivative financial instruments are all classified as Level 2 in both years. Level 2 fair value
measurements are those derived from inputs other than quoted prices that are observable for the asset or liability
either directly (i.e. as prices) or indirectly (i.e. derived from prices).
During the previous year the group had an oil put option designated as a cash flow hedge in order to reduce the
Groups exposure to fluctuations in oil prices. The change in the fair value of oil put option amounting to USD
3,662 thousand was recognised in the consolidated statement of comprehensive income and a realised hedge loss
of USD 7,101 thousand was recognised in the income statement. The oil options were settled in full in 2011 and
no further commodity instruments were entered into.
