CapitaLand Investment Limited - Annual Report 2021

257 CapitaLand Investment Limited 256 Annual Report 2021 Notes to the Financial Statements Notes to the Financial Statements 33 FINANCIAL RISK MANAGEMENT (continued) (d) Liquidity risk (continued) The following table provides a reconciliation by risk category of components of equity and analysis of other comprehensive income items (net of tax) resulting from cashflow hedge accounting. 2021 2020 $’M $’M The Group At 1 January (51) (33) Change in fair value: – Interest rate risk 49 (20) Amount reclassified to profit or loss: – Interest rate risk 1 2 At 31 December (1) (51) (e) Offsetting financial assets and financial liabilities The Group’s derivative transactions that are not transacted through an exchange, are governed by the ISDA Master Netting Agreements. In general, under such agreements, the amounts due on a single day in respect of all transactions outstanding in the same currency are aggregated into a single net amount and settled between the counterparties. In certain circumstances, for example when a credit event such as a default occurs, all outstanding transactions under the agreement are terminated, the termination value is assessed and set off into a single net amount to be settled. The above ISDA agreements do not meet the criteria for offsetting in the balance sheets as a right of set-off of recognised amounts is enforceable only following an event of default, insolvency or bankruptcy of the Group or the counterparties. In addition, the Group and its counterparties do not intend to settle on a net basis or to realise the assets and settle the liabilities simultaneously. There is no offset of the Group and the Company’s financial assets and financial liabilities as of the reporting dates. 34 COMMITMENTS As at the reporting date, the Group had the following commitments: (a) Operating lease The Group’s operating lease relates to leases with lease terms of 12 months or less or low value assets. Future minimum lease payments for the Group on non-cancellable operating leases are as follows: The Group 2021 2020 $’M $’M Lease payments payable: Not later than 1 year 68 30 Between 1 and 2 years 1 1 69 31 34 COMMITMENTS (continued) (b) Commitments The Group 2021 2020 $’M $’M Commitments in respect of: – capital expenditure contracted but not provided for in the financial statements 12 15 – development expenditure contracted but not provided for in the financial statements 500 128 – capital contribution in associates and joint ventures 944 847 – purchase of land/a property contracted but not provided for in the financial statements 92 8 1,548 998 (c) As at the reporting date, the notional principal values of financial instruments were as follows: The Group 2021 2020 $’M $’M Interest rate swaps 5,126 1,591 Forward foreign exchange contracts 311 457 Cross currency swaps 751 696 6,188 2,744 The maturity profile of these financial instruments was: The Group 2021 2020 $’M $’M Not later than 1 year 1,676 718 Between 1 and 5 years 4,512 2,026 6,188 2,744