Integrated
Annual Report 2011

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Grupa LOTOS S.A. - Integrated Annual Report 2011
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37. Trade and other payables, accruals and deferred income, other liabilities, and other financial liabilities

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37.1 Trade payables, accruals and deferred income, and other liabilities

PLN '000 Note Dec 31 2011 Dec 31 2010
(restated)
Trade payables, including:   2,821,742 1,832,545
- to related parties 39.1 6,823 -
Liabilities to the state budget other than corporate income tax   966,530 759,184
Special accounts, including:   24,694 21,871
- Mining Facilities Decommissioning Fund   24,491 21,668
Salaries and wages payable   14,577 13,052
Accrued expenses,including:   118,869 110,136
- provision for costs of employee benefits   64,273 78,162
Deferred income, including:   46,790 48,315
- grants (1)   39,321 40,012
- other   7,469 8,303
Investment liabilities   164,217 165,809
Liabilities to insurers   30,259 22,201
Other liabilities   23,246 27,804
Total   4,210,924 3,000,917
Non-current portion   54,371 61,809
Current portion   4,156,553 2,939,108

(1) Primarily licences received free-of-charge and grants from the Eco Fund for the use of waste gas from the offshore oil production facility for heating purposes.

Trade payables do not bear interest and are, as a rule, settled on a 7–60 day basis. Other liabilities do not bear interest, and their average payment period is one month. The amount resulting from the difference between VAT receivable and VAT payable is paid to the relevant tax authorities on a monthly basis. Interest payable is usually settled on a monthly basis during a financial year.

Pursuant to Art. 8 of the Excise Duty Act of December 6th 2008 (Dz. U. No. 3, item 11/2008), a tax liability arises e.g. at the moment of taking harmonised excise goods out of a bonded warehouse.  The Parent and some other Group companies operate registered bonded warehouses, in which harmonised excise goods are subject to suspended-excise-tax procedure and may be the object of the actions provided for in the Excise Duty Act.

For sensitivity analysis of trade and other liabilities with respect to market risk related to fluctuations in exchange rates as at December 31st 2011, and December 31st 2010, see Note 42.3.1.

For maturity analysis of trade and other liabilities as at December 31st 2011, and December 31st 2010, see Note 41.

37.2 Other financial liabilities 

PLN '000 Dec 31 2011 Dec 31 2010
(restated)
Negative valuation of derivative financial instruments: 267,778 279,807
- commodity swap
(commodities and petroleum products)
- 3,517
- futures (COemissions) 15,607 463
- currency forward and spot contracts 70,449 41,654
- forward rate agreements (FRAs) - 340
- interest rate swap (IRS) 172,134 227,897
- currency swap 9,588 5,936
Lease liabilities 197,000 74,255
Total financial liabilities 464,778 354,062
Non-current liabilities 304,949 151,666
Current liabilities 159,829 202,396

As at December 31st 2011, there were no hedging contracts over which an assignment would be created as security for the credit facility referred to in Note 34 (December 31st 2010: PLN 120,822 thousand).

For sensitivity analysis of other financial liabilities with respect to currency and interest rate risks as at December 31st 2011 and December 31st 2010, see Note 42.3.

For maturity analysis of other financial liabilities as at December 31st 2011 and December 31st 2010, see Note 41.

37.3 Finance lease liabilities

PLN '000 Minimum lease payments Present value of minimum lease payments
  Dec 31 2011 Dec 31 2010 Dec 31 2011 Dec 31 2010
Up to 1 year 41,113 21,115 19,415 2,696
From 1 to 5 years 153,520 86,070 91,357 32,774
Over 5 years 98,221 51,762 86,228 38,785
Total 292,854 158,947 197,000 74,255
Less future financial charges (95,854) (84,692) - -
Present value of minimum lease payments  197,000 74,255 197,000 74,255
Non-current portion     177,585 71,559
Current portion     19,415 2,696

The Group uses finance leases to finance primarily rolling stock assets.

This is a translation of a document originally issued in Polish.