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• Andritz 2007
• Customer Projects
• Sustainability and Corporate Responsibility
• Business Areas
• Andritz Automation
• Human Resources
• Manufacturing, Procurement, and Quality
• Annual Financial Report 2007
  • Status Report
  • Statement by the Executive Board
  • Report of the Supervisory Board
  • Auditor's Report
  • Consolidated Balance Sheet
  • Consolidated Income Statement
  • Consolidated Cash Flow Statement
  • Consolidated Statement of Shareholders' Equity
  • Notes to the Consolidated Financial Statements
    • A. General
    • B. Summary of Significant Accounting Policies
    • C. Acquisitions
    • D. Accounting and Valuation Principles
    • E. Segments
    • F. Notes to the Consolidated Balance Sheet
    • G. Notes to the Consolidated Income Statement
    • H. Segment Information
    • I. Notes to the Consolidated Cash Flow Statements
    • J. Financial Instruments
      • a. Risk Management
      • b. Liquidity Risks
      • c. Credit Risks
      • d. Interest Risk
      • e. Sensitivity analyses
      • f. Fair Value of Financial Instruments
    • K. Leases
    • L. Commitments
    • M. Contingent Liabilities
    • N. Related Party Transactions
    • O. Subsequent Events
    • P. List of Consolidated Subsidiaries
  • Financial Statement of Andritz AG
• Locations of the Andritz Group
• Glossary
• Disclaimer

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c. Credit Risks

Credit risks, or the risk of counterparties defaulting, are controlled by the application of credit approvals, limits and monitoring procedures. Where appropriate, the Group obtains guarantees from governmental export agencies or similar private institutions to reduce the risk of a counterpart defaulting. Furthermore, there is no existent concentration of default risk due to high diversification of contract parties across diverse industries and geographical areas.

Credit risk associated with the investment of liquid funds and securities is limited by the fact that the Group works only with banks which can demonstrate sound creditworthiness.

For certain financial assets and financial liabilities, the Group has a legally enforceable right to set off. These amounts are only reported on a net basis. For all existing risks, valuation allowances are included so that the Management believes that no other credit risk will occur.

Without considering risk minimization strategies as described above, the carrying amounts of financial assets recorded in the financial statements, grossed up for any allowances for losses, represent the Group’s maximum exposure to credit risk of the corresponding categories.

(in TEUR)	2007		2006*
Held for trading	19,762		15,772
Available for sale	108,789		49,975
Loans and receivables	1,042,359		1,137,623
	1,170,910		1,203,370

Credit risk exposure (Download size 22 KB)

*restated

The trade receivables in the category 'loans and receivables' are impaired by TEUR 14,670 (balance 2006: TEUR 12,564). In all other categories there was no need for an impairment.

The Group does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics. The Group defines counterparties as having similar characteristics if they are related entities. The three largest customers contribute 15% of all incoming orders in various strategic business areas. As there is no significant concentration of credit risk, the Executive Board believes no further credit provision is required in excess of the allowance for doubtful debts already recognized.