Financial Statements 2021

4. Notes to the IFRS Company Financial Statements /

15.5 Derivative Financial Instruments and Hedge Accounting Disclosure The following table presents the amounts relating to items designated as hedging instruments, no hedge ineffectiveness as of 31 December 2021 under IFRS 9:

31 December

2021

2020

Carrying values

Carrying values

Asset

Liability

Asset

Liability

(In € million)

Foreign currency risk Net forward sales contracts

0

0

0

0

0

0

0

0

Foreign exchange options

Interest rate risk

190

93

412

0

0

0

0

0

Commodity swap risk

0

0

0

0

Equity swap risk

Total

190

93

412

0

15.6 Net Gains or Net Losses The Company’s net gains or net losses recognised in profit or loss in 2021 and 2020, respectively are as follows:

31 December

2021

2020

(In € million)

Financial assets or financial liabilities at fair value through profit or loss Held for trading

29

94

318

(306)

Designated on initial recognition

268

(330)

Financial assets at amortised cost (1)

20

75

Financial assets at fair value through OCI

57

(174)

Financial assets at fair value through profit or loss

Financial liabilities measured at amortised cost

(737)

423

(45)

(218)

Total

(1) Including impairment and Expected Credit Losses on Financial assets at amortised cost.

15.7 Impairment Losses Loss allowances —For its portfolio of debt instruments including bonds, term deposits and commercial papers, the Company measures loss allowances at an amount that represents credit losses resulting from default events that are possible within the next 12 months, unless the credit risk on a financial instrument has increased significantly since initial recognition. In the event of such significant increase in credit risk the Company measures loss allowances for that financial instrument at an amount equal to its life-time expected losses, i.e. at an amount equal to the expected credit losses that result from all possible default events over the expected life of that financial instrument. The Company applies the low credit risk exemption allowing the Company to assume that there is no significant increase in credit risk since initial recognition of a financial instrument,

if the instrument is determined to have low credit risk at the reporting date. Similarly, the Company has determined that its trade receivables and contract assets generally have low credit risk. The Company applies the simplified approach permitted by IFRS 9 of measuring expected credit losses of trade receivables and contract assets on a lifetime basis from initial recognition. Investment grade instruments — The Company considers a significant increase in credit risk to have occurred, if there is a downgrade by four notches such that the instrument moves into a high yield bucket as a direct result of the downgrade. With respect to instruments that were high yield at initial recognition, a downgrade by four notches is considered as a significant increase in credit risk.

110

Airbus / Financial Statements 2021