Note 33
Financial statements - Notes to the consolidated financial statements
Fair values of other financial assets and liabilities
The following table presents the fair values of financial instruments (including current portions) compared to the carrying
amounts for which these instruments are included in the balance sheets:
December 31, 2006 January 1, 2006
Carrying Fair Carrying Fair
amount value amount value
Loans receivable and other financial assets
83
83
102
104
Derivatives
324
324
286
286
Total financial assets
407
407
388
390
Bonds and notes
(3,759)
(3,957)
(4,171)
(4,296)
Other loans
(383)
(388)
(372)
(382)
Financing obligations
(488)
(636)
(543)
(745)
Mortgages payable
(20)
(22)
(37)
(40)
Finance lease liabilities
(1,277)
(1,542)
(1,362)
(1,733)
Cumulative preferred financing shares
(497)
(526)
(666)
(741)
Derivatives
(193)
(193)
(206)
(206)
Total financial liabilities (6,617) (7,264) (7,357) (8,143)
The carrying amounts of cash, cash equivalents,
receivables, accounts payable and other current financial
assets and liabilities approximate their fair values because
of the short-term nature of these instruments and, for
receivables, because of the fact that any recoverability loss is
reflected in an impairment loss. These amounts are not
included in the table above.
The fair values of quoted borrowings are based on year-end
ask-market quoted prices. The fair value of quoted bonds
and notes as at January 1, 2006 has been restated to reflect
the market quotations instead of the value determined
based on the discounted cash flow analyses. The fair value
of other non-derivative financial assets and liabilities are
estimated using discounted cash flow analyses based on
market rates prevailing at the year end. The fair value
calculation method and the conditions for redemption and
conversion of the cumulative preferred financing shares are
disclosed in Note 27. Fair value of derivative financial assets
and liabilities are estimated by discounting future cash flows
with prevailing market rates or based on the rates and
quotations obtained from third parties. The accrued interest
is included in other current financial liabilities (Note 29)
and not in the carrying amounts of non-derivative financial
assets and liabilities. Accrued interest is included in
the determination of the fair value of financial assets
and liabilities.
108 Ahold Annual Report 2006
