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MEDIASET ESPAÑA COMUNICACIÓN, S.A. AND SUBSIDIARIES
23.5. Capital management policy
The Group’s capital management policy is focused on securing a return on investment for shareholders that maximizes
the profitability of their contribution to the company with the least amount of risk possible, contributing with an
attractive risk investment in line with the current economic and business environment. The capital structure of the
company places it in an excellent position as a result of its significant capacity to generate positive cash flows, even in
the current markets condition.
23.6. Risk management policy
To efficiently manage the risks to which the Group is exposed, certain control and prevention mechanisms have been
designed and implemented, led by the senior executives of the Group in the Audit Committees.These mechanisms have
been put into place in the corporate governance rules and have been applied throughout the Group.
The measures adopted by the Group to manage risks can be classified into three main categories and were designed
to cover exposure to credit risk, liquidity risk, and market risk.
23.6.1. Credit risk
Credit risk exists when a potential loss may arise from the Company’s counterparty not meeting its contractual obligations,
i.e., the possibility that financial assets will not be recovered at their carrying amount within the established timeframe.
The Group maximum exposure to credit risk at December 31, 2015 and December 31, 2014 is as follows:
Thousands of euros
2015
2014
Non-current receivables
14,813
6,349
Trade and other receivables
242,382 221,899
Trade receivables from related parties
1,089
2,098
Current financial assets
1,019
1,309
Cash and cash equivalents
211,397 275,782
470,700 507,437
For the purposes of credit risk Group management differentiates between financial assets arising from operations and
those arising from investments.
23.6.2. Operating activities
Most of the operating activities of the Group consist of advertising revenues.
Group management has developed a policy whereby credit limit by customer type and authorization levels in order to
approve transactions are established.
The financial assets considered as part of the operating activities are mainly trade receivables for sales and services.
From a business standpoint, the Group considers the advertisers to be the end customer; none of these represents
significant business revenue in terms of the Group’s total turnover. It is standard sector practice to use media agencies
as intermediaries between advertisers and the television channel offering the advertising space.
The Group constantly monitors the age of its debt, and there were no risk situations at year end.