Yudu - John Lewis Partnership Annual Report and Accounts 2013

John Lewis Partnership plc annual report and accounts 2013

Notes to the accounts continued

22 Management of financial risks (continued)

The following analysis shows the contractual undiscounted cash flows payable under financial liabilities and derivative financial liabilities at the balance sheet date:

Due within 1 year £m - Due between 1 and 2 years £m - Due 2 years and beyond £m

Non-derivative financial liabilities

Borrowings and overdrafts (156.3) – (722.2)

Interest payments on borrowings* (54.5) (44.0) (304.1)

Finance lease liabilities (4.6) (4.6) (58.0)

Trade and other payables (1,156.6) (0.7) –

Derivative financial liabilities

Derivative contracts – receipts 163.0 – –

Derivative contracts – payments (166.7) – –

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At 26 January 2013 (1,375.7) (49.3) (1,084.3)

Non-derivative financial liabilities

Borrowings and overdrafts (302.1) (100.0) (707.6)

Interest payments on borrowings* (64.2) (54.5) (358.6)

Finance lease liabilities (1.8) (1.8) (51.2)

Trade and other payables (966.7) (1.7) –

Derivative financial liabilities

Derivative contracts – receipts 152.9 – –

Derivative contracts – payments (153.2) – –

At 28 January 2012 (1,335.1) (158.0) (1,117.4)

* Excludes annual interest of £0.3m on cumulative preference stock which have no fixed redemption date.

Interest on borrowings is calculated based on the borrowing position at the financial year end without taking account of future issues.

For the purposes of this note, the foreign currency element of forward foreign currency contracts is translated at spot rates prevailing at the year end.

Interest rate risk

In order to manage the risk of interest rate fluctuations the Partnership targets a ratio of fixed and floating rate debt in line with the Partnership Board approved treasury policy.

An analysis of the Partnership’s financial liabilities is detailed in note 25. Exposures to interest rate fluctuations are managed using interest rate derivatives. As authorised by the Partnership Board, the ratio of fixed to floating rate borrowing has remained outside treasury policy during the year, as it was decided not to enter into new interest rate swaps given the historically low bond yield levels.