Hedging / Derivative
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The Group’s policy is to remain unhedged to the gold price. However, hedges are sometimes undertaken on a project specific basis as follows:
- to protect cash flows at times of significant expenditure;
- for specific debt servicing requirements; and
- to safeguard the viability of higher cost operations.
Gold Fields may from time to time establish currency financial instruments to protect underlying cash flows. |
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South Africa forward cover contracts* |
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South African rand forward cover contracts were taken out to cover commitments of the South African operations in various currencies. Outstanding at the end of December 2010 were the following contracts:
- US$/ZAR – US$2.2 million in total, with a negative marked to market value of US$0.2 million
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* Do not qualify for hedge accounting and will be accounted for as derivative financial instruments in the income statement. |
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