149
ANNUAL REPORT AND CONSOLIDATED ACCOUNTS 2012
number of ordinary shares issued during the period, ex-
cluding ordinary shares acquired by the company and
held as own shares (Note 15).
Diluted
The profit diluted per share is calculated by dividing
the profit payable to shareholders – adjusted by the
dividends of convertible preference shares, convertible
debt interest and gains and expenses resulting from the
conversion – by the average number of ordinary shares
issued during the period plus the average number of
ordinary shares that may be issued in the conversion
of ordinary shares that may be potentially used in the
dilution.
2.20 Derivatives financial instruments
The Group uses derivatives financial instruments, such
as exchange forwards and interest rate swaps, only to
cover the financial risk witch the Group is exposed to.
The Group doesn’t use derivatives financial instruments
for speculation. For the carrying amount of derivatives
financial instruments, the Group uses hedge accounting
policies under the terms of the legislation in force. De-
rivatives financial instruments negotiation is carried out
by the Group, on behalf of their subsidiaries, by the fi-
nancial department under the policies approved by the
Board of directors. Derivative financial instruments are
initially measured at the transaction date fair value, be-
ing subsequently measured at each reporting date fair
value. Gains or losses of fair value changes are recog-
nised as follows:
Fair value hedge
In an operation to hedge the exposure to fair value of an
asset or liability (“fair value hedge”) determined as effec-
tive hedges, the fair value changes are recognised in the
income statement jointly with the fair value changes of
the risk component of the hedged item.
Cash flow hedge
In an operation to hedge the exposure to future cash-
flows of an asset or liability (“cash-flow hedge”), the
effective part of the fair value changes in the hedging
derivative are recognizes in equity; the ineffective part
of the hedging is recognized in the income statement
when it occurs.
Net investment hedge
Currently there are no foreign operational units (sub-
sidiaries) in currencies other than the euro, therefore
the Group is not exposed to foreign currency exchange-
rate risks.
The Group has well identified the nature of the involved
risks, guarantees through its software that each hedge
instrument is followed under the Group’s risk policy,
recording thorough and formally the hedges relation-
ships; the hedges goal and strategy; classification of the
hedges relationship; description of the nature of the
risk that’s being cover; identification of the hedge instru-
ment and covered item; description of initial measure
and future effectiveness of the hedge; identification of
the excluded, if any, part of the hedge instrument.
The Group will consider discontinued an hedge instru-
ment when it is sold, expires or is realised; the hedge
ceases to fulfil the hedge accounting criteria; for the
cash flow hedge the expected transaction in unlikely or
unexpected; the Group cancels the hedge instruments
for managing reasons.
