DSV Annual Report 2022
72
DSV Annual Report 2022 Consolidated financial statements 2022
= III
4.5 Derivative financial instruments
Accounting policies
Derivative financial instruments are recognised on the trade date and are
measured at fair value. Positive and negative fair values are included in oth-
er current receivables or other current payables in the balance sheet. Posi-
tive and negative fair values are only offset if the Group has a right and an
intention to settle several financial instruments net (by means of settle-
ment of differences). Fair value is determined based on generally accepted
valuation methods using available observable market data.
When entering into contracts for financial instruments, an assessment is
made of whether the instrument qualifies for hedge accounting, including
whether the instrument hedges recognised assets and liabilities or net in-
vestments in foreign entities. The effectiveness of recognised financial in-
struments is assessed on a monthly basis, and any ineffectiveness is recog-
nised in the income statement.
Fair value changes which are classified as and fulfil the criteria for recogni-
tion as a fair value hedge are recognised in the income statement together
with changes in the value of the part of the asset or liability that has been
hedged.
Fair value changes in the part of the derivative which is classified as and
qualifies for recognition as a future cash flow hedge and which effectively
hedges against changes in the value of the hedged item are recognised in
other comprehensive income as a separate hedging reserve.
When the underlying hedged item is realised, any gain or loss on the hedg-
ing transaction is transferred from equity and recognised together with the
hedged item.
Fair value changes that do not meet the criteria for treatment as hedging
instruments are recognised on an ongoing basis in the income statement
under financial items.
Foreign currency risk hedging
The Group mainly uses foreign exchange forward contracts to hedge for-
eign currency risks. The main currency hedged is USD. The foreign ex-
change forward contracts are used as fair value hedges of currency expo-
sures relating to external balance sheet assets and liabilities as well as
expected short-term operational cash flows.
A loss on hedging instruments of DKK 184 million was recognised in the
income statement for 2022 (2021: a loss of DKK 84 million). In the same
period, a gain of DKK 460 million was recognised relating to assets and
liabilities (2021: a loss of DKK 28 million). The net gain in 2022 primarily
relates to unhedged intercompany positions.
External hedging instruments
(DKKm)
Contractual value
Maturity (year)
Fair value
Of which recognised in
income statement
Of which recognised in OCI
Interest rate risk hedging
The Group has obtained long-term loans mainly on a fixed rate basis,
which means that the Group is less exposed to interest rate fluctuations.
The Group mainly uses interest rate swaps to hedge future cash flows
relating to interest rate risks. Thereby, floating-rate loans are converted
to fixed-rate financing.
At the balance sheet date, the Group no longer had any interest rate
swaps. The weighted average effective interest rate of existing interest
rate instruments used as hedges of long-term loans was therefore 0.0%
at the reporting date (2021: 0.8%).
2022
Currency
instruments
Interest rate
instruments
Total
Currency
instruments
2021
Interest rate
instruments
Total
5,589
5,589
2023
11,801
2022
744
12,545
2022
93
93
(33)
(7)
(40)
97
97
(34)
(34)
(4)
(4)
1
(7)
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