4.14
14. Fair value measurement

1. Accounting classification and fair values
The following table shows the carrying amount and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value.

    Fair value - hedging instruments Loans and receivables Other financial liabilities    
    Carrying amount Total fair value Fair value hierarchy
    2021 2021 2021 2021  
  Notes € x 1,000 € x 1,000 € x 1,000 € x 1,000  
Forward exchange contracts used for hedging 12 18,076 - - 18,076 Level 2
Financial assets measured at fair value   18,076 - - 18,076  
             
Other financial assets 10.5 - 1,818 - 1,818  
Trade and other receivables 8.2 - 160,744 - 160,744  
Cash and cash equivalents   - 48,469 - 48,469  
Financial assets not measured at fair value   - 211,031 - 211,031  
             
Interest rate swaps used for hedging 12 893 - - 893 Level 2
Forward exchange contracts used for hedging 12 2,040 - - 2,040 Level 2
Financial liabilities measured at fair value   2,933 - - 2,933  
             
Term loans 9.1 - - 109,511 109,511  
Term loan (GO-C facility) 9.1 - - - -  
Term loan (Schuldschein) 9.1 - - 14,963 15,654 Level 2
Other bank loans (secured) 9.1 - - 1,292 1,292  
Other bank loans (unsecured) 9.1 - - 688 688  
Lease liabilies 9.1 - - 30,224 30,224  
Revolving credit facility 9.1 - - 60,420 60,420  
Bank overdrafts 9.1 - - 48,266 48,266  
Trade payables and other current liabilities 8.3 - - 276,555 276,555  
Financial liabilities not measured at fair value   - - 541,919 542,610  

    Fair value - hedging instruments Loans and receivables Other financial liabilities    
    Carrying amount Total fair value Fair value hierarchy
    2020 2020 2020 2020  
  Notes € x 1,000 € x 1,000 € x 1,000 € x 1,000  
Forward exchange contracts used for hedging 12 164 - - 164 Level 2
Financial assets measured at fair value   164 - - 164  
             
Other financial assets 10.5 - 1,958 - 1,958  
Trade and other receivables 8.2 - 128,505 - 128,505  
Cash and cash equivalents   - 173,376 - 173,376  
Financial assets not measured at fair value   - 303,839 - 303,839  
             
Interest rate swaps used for hedging 12 1,619 - - 1,619 Level 2
Forward exchange contracts used for hedging 12 14,224 - - 14,224 Level 2
Financial liabilities measured at fair value   15,843 - - 15,843  
  9.1          
Term loans 9.1 - - 108,536 108,536  
Term loan (GO-C facility) 9.1 - - 59,743 59,743  
Term loan (Schuldschein) 9.1 - - 14,932 15,981 Level 2
Other bank loans (secured) 9.1 - - 1,487 1,487  
Other bank loans (unsecured) 9.1 - - 5,938 5,938  
Lease liabilies 9.1 - - 28,957 28,957  
Revolving credit facility 9.1 - - 13,936 13,936  
Bank overdrafts 8.3 - - 19,046 19,046  
Trade payables and other current liabilities   - - 186,909 186,909  
Financial liabilities not measured at fair value   - - 439,484 440,533  

 

2. Transfers between Level 1 and 2
There were no transfers from Level 1 to Level 2 or from Level 2 to Level 1 in 2021 (or 2020).

Accounting estimates regarding fair value measurement
i. Valuation techniques

The fair value of the forward exchange contracts and interest rate swaps is determined on the basis of inputs other than observable quoted rates/prices (level 2). Generally accepted valuation methods are used to determine fair value. The value determined in this way is equal to the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants.

Forward exchange contracts
Values are determined using the discounted future cash flow model. The fair value is determined using (interpolated) quoted forward exchange rates at the reporting date and discounted by the appropriate discount factor derived from the appropriate swap curve.

Interest rate swaps
Values are determined using the discounted future cash flow model. The market value of a swap is calculated as the sum of two different loans. In the event of a fixed – floating swap, the interest on the first loan is based on a fixed rate, while the interest on the second loan is based on a floating rate. Each individual loan (also known as the leg of a swap) has its own market value. This market value is the sum of the individual future cash flows, discounted by the appropriate discount factor. The individual future cash flows are based on the rate of the contract (fixed leg) or on a forward interest rate curve (floating leg). The fair value is subject to a credit risk adjustment that reflects the credit risk of Accell Group and of the counterparty.

Other financial liabilities
Values are determined using the discounted cash flow model. The valuation model takes into account the present value of expected payment, discounted using a risk-adjusted discount rate.

ii. Measurement of fair values

A number of Accell Group’s accounting policies and disclosures require fair value measurement, for both financial and non-financial assets and liabilities. When measuring the fair value of an asset or a liability, Accell Group uses observable market data as much as possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability might be categorized in different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. Accell Group recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during which the change occurred.