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CONSOLIDATED FINANCIAL STATEMENTS AND CONSOLIDATED MANAGEMENT REPORT 2015
23.6.3. Investing activities
The financial assets considered as investment activity are non-current loans (Note 11), non-current financial investments
(Note 11) and current financial investments.Those notes provide information on the concentration of this risk and the
related maturities.
A Financial Risk Management Procedures Manual sets forth the general criteria governing investments of the Group’s
treasury surpluses, which, in broad terms, are as follows:
• The investments are made with institutions (whether domestic or foreign) of recognized financial solvency
measured based on their current ratings.
• The investments are placed in conservative products (bank deposits, debt repos, etc.,) on which, in general, the
repayment of the invested capital is guaranteed.
• Authorizations for the corresponding investments are limited by the powers granted to the group’s senior
executives and, in any event, are highly restricted (according to the amount, the Chief Executive Officer, General
Management and Operations Director, and Financial Director).
• Under ordinary circumstances, the longest term is three months and the investments usually offer automatically
available funds.
23.6.4. Liquidity risk
The Company’s financial structure is at a low liquidity risk, given the absence of financial leveraging and the level of
operating cash flows generated each year.
Liquidity risk would result from the Group having insufficient funds or access to sufficient funds at an acceptable cost
to meet its payment obligations at all times.The Group’s objective is to maintain sufficient available funds to conduct its
business.
The Group’s policies establish the minimum liquidity levels required at all times:
• Excess liquidity may only be invested in certain types of assets (see previous section on credit risk/investment
activities) the liquidity of which is guaranteed.
• The amount of the Group’s revolving credit lines ensures that the Group is able to meet its operating needs as
well as finance new short-term investment projects. At year-end 2015, the opening credit lines total 295 million
euros (2014: total 360 million euros). Given the actual market situation, these credit lines have been contracted
under very competitive financial conditions, which strengthen the financial sector’s perception that the Group
is creditworthy and sound.
23.6.5. Market risk (exchange rate, interest rate, and price risk)
Given the nearly complete absence of financial debt, there are no financial risks associated with interest-rate movements.
Nevertheless, and for illustrative purposes, the Group has conducted a test to determine the sensitivity of the Group’s
cash surpluses to certain modifications in interest rates.
The following assumption was used: beginning with our year-end cash surpluses, and taking the 1-month Euribor at
December 31, 2015, as the benchmark, we applied a variation of +50 basis points -20 basis points (+50 basis points –
10 basis points in 2014).