PC9. Financial instruments

Interest-bearing liabilities

The counterparty for all outstanding bond issues within Svenska Cellulosa Aktiebolaget SCA was changed to Essity Aktiebolag in 2016. In 2017, the company also assumed all other non-current loans recognized in Svenska Cellulosa Aktiebolaget SCA’s balance sheet on December 31, 2016.

Financial instruments by category

AP Accounting principles

In accordance with Paragraph 3 of RFR 2, the Parent Company has chosen not to apply IAS 39. The Parent Company recognizes financial fixed assets at cost less any impairment and financial current assets according to the lower of cost or market rule. For derivatives used for hedging purposes, recognition is determined by the hedged item. Currency derivatives used to hedge foreign receivables and liabilities are remeasured at the closing day rate to match the currency remeasurement in the receivable/liability. Interest rate derivatives used to hedge interest rate exposure in financial receivables or liabilities are recognized at fair value as of the 2017 fiscal year. The accounting principles for financial instruments are applied for the items below. The financial instruments in the Parent Company are classified as loans and trade receivables for assets, and other financial liabilities measured at amortized cost for liabilities. No other categories have been utilized over the past two years. These balance sheet items are not fully reconcilable since they may include items that are not financial instruments.