113
ANNUAL REPORT AND CONSOLIDATED ACCOUNTS 2013
D) LIQUIDITY RISK
As already mentioned, the recent situation of the finan-
cial markets has lent a new importance to liquidity risk.
Systematic financial planning based on cash flow fore-
casting in different scenarios and for periods of more
than one year has become an imperative in the Group.
Short-term cash management is based on the annual
plan, which is reviewed quarterly and adjusted daily. In
line with the dynamics of the underlying businesses, the
Group’s Treasury aims for flexible management of com-
mercial paper and the negotiation of lines of credit that
are available at all times. The policy of open dialogue
with all the financial partners has allowed the Group to
maintain relationships of trust, despite the liquidity re-
strictions Portuguese banks have had to contend with.
Despite the cost, the Group has given priority to liquidity
risk and has been reinforcing its medium and long-term
funding by replacing short-term credit lines and putting
surplus funds into longer-term deposits. Managing li-
quidity risk also means maintaining a comfortable lev-
el of available funds. The Group ended the year with
nearly 22 million euros of available funds, equivalent to
nearly 36% of the interest-bearing liabilities. However,
reducing liquidity risk increases the risk associated with
investing the cash surpluses.
E) CAPITAL RISK
The Company seeks to maintain a level of capital appro-
priate to its principal business (cash sales and suppli-
er credit) and ensure its continuity and expansion. The
balance of the capital structure is monitored based on
the leverage ratio (defined as: net interest-bearing debt
/ (net interest-bearing debt+shareholders’ equity)), aim-
ing to keep this ratio within the 35%-70% range. In 2013,
as a measure of prudence in view of the current market
constraints, we maintained a ratio of 17%.
Environmental
The environmental risk management area is overseen
by the Quality Unit, whose main concern is the imple-
mentation of the policy deriving from Ibersol’s Sustain-
ability Principles, so that environmental processes and
procedures are applied across the organization.
Adoption of good environmental management practic-
es is a matter of concern to Ibersol’s Board of Directors,
which promotes a responsible, proactive approach to
resource and waste management.
The procedures set forth in Ibersol’s Standards Manual
as regards environmental matters are focused mainly
on the rational use of electricity and the recycling of
used oil and packaging.
Legal
Ibersol and its businesses have a legal function, which
works full-time, in coordination with the other central
and business functions, to protect the Group’s interests,
while ensuring strict compliance with the Group’s legal
duties and implementation of good practices.
Legal advice is also obtained, at national and interna-
tional level, by recognized outside experts.
