204 / 248
NOTES TO THE COMPANY ANNUAL FINANCIAL STATEMENTS
CONTINUED
For the year ended 31 May 2015
202
BLUE LABEL INTEGRATED ANNUAL REPORT 2015
2.
FINANCIAL RISKS continued
Market risk
Market risk is the risk that changes in market prices (interest rate and currency risk) will affect the
Company’s income or the value of its holding of financial instruments. The objective of market risk
management is to manage and control market risk exposures within acceptable parameters, while
optimising the return.
The Company is exposed to risks from movements in foreign exchange rates and interest rates that
affect its assets, liabilities and anticipated future transactions.
Fair value measurement hierarchy:
•
•
Level 1: fair value based on quoted prices (unadjusted) in active markets for identical assets or
liabilities;
•
•
Level 2: fair value based on inputs other than quoted prices included within level 1 that are
observable for the asset or liability, either directly (that is, as prices) or indirectly (that is,
derived from prices); or
•
•
Level 3: fair value based on inputs for the asset or liability that are not based on observable market
data (that is, unobservable inputs).
Contingent consideration, included in trade and other payables, are level 3 financial liabilities.
Changes in level 3 instruments are as follows:
2014
R’000
Contingent consideration
Opening balance
7 256
3 030
Acquisition of Panacea Proprietary Limited
—
6 155
Acquisition of Viamedia Proprietary Limited
84 783
—
Settlements
(4 113)
(1 800)
Gains and losses recognised in profit or loss
5 354
(129)
Closing balance
93 280
7 256
Total gains or losses for the period included in profit or loss for
liabilities held at the end of the reporting period, under:
Other income
(923)
(827)
Interest paid
6 277
698
Change in unrealised gains or losses for the period
included in profit or loss for liabilities held at the end
of the reporting period
1 382
698
2015
R’000