FIFA uses derivative instruments to manage its foreign currency risk, which is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes to foreign exchange rates. The group’s exposure to that risk relates primarily to its operating activities (when contracts with customers or suppliers are denominated in foreign currency).
Derivatives designated as hedging instruments
Foreign exchange forward contracts are designated as hedging instruments in cash flow hedges of forecast television broadcasting sales in EUR. These forecast transactions are highly probable. The total notional amount of the outstanding foreign exchange forward contracts, which are designated as hedge accounting, was USD 100 million (2022: USD 129.9 million). There is an economic relationship between the hedged items and the hedging instruments, as the terms of the foreign exchange forward contracts match those of the highly probable forecast transactions. Because the group does not hedge all of its revenue denominated in foreign currencies, the hedged item is identified as a proportion of the forecast transaction. The group has established a hedge ratio of 1:1 for the hedging relationships, as the underlying risk of the foreign exchange forward contracts is identical to the hedged risk. There are no material sources of ineffectiveness and, therefore, no ineffectiveness was recognised in the income statement. In 2023, USD 4 million was transferred from the cash flow hedge reserves to contract liabilities (2022: USD 0 million). No transfer from the cash flow hedge reserves to the “Revenue from television broadcasting rights” line item was recognised in the consolidated statement of comprehensive income for 2023 (2022: USD 49.8 million). At the reporting date, the group held the following foreign exchange forward contracts, which are designated as hedge accounting:
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31 December 2023
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31 December 2022
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in TUSD
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Notional amount
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Average forward exchange rate EUR/USD
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Notional amount
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Average forward exchange rate EUR/USD
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| – to mature in 1 year | 40,455 | 1.20 | 41,695 | 1.20 |
| – to mature in subsequent years | 59,556 | 1.22 | 88,177 | 1.23 |
| Total | 100,011 | 129,872 |
Other derivative financial instruments
Several financial investments were made in foreign currencies in 2023. The foreign exchange risk was hedged using swaps, forwards and options. The total notional value of the outstanding swaps and options as at 31 December 2023 amounted to USD 3,077 million (2022: USD 3,554 million). All other derivative financial instruments will mature in 2024. The derivative financial instruments are valued at fair market prices. The following table sets out the carrying amounts of derivative financial assets and liabilities recognised in the consolidated balance sheet:
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31 December 2023
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31 December 2022
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in TUSD
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Positive fair value
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Negative fair value
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Positive fair value
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Negative fair value
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| Derivatives designated as hedging instruments | ||||
| – to mature in 1 year | 3,023 | 108 | 4,129 | 0 |
| – to mature in subsequent years | 3,923 | 170 | 8,126 | 0 |
| Other derivative financial instruments | ||||
| – to mature in 1 year | 5,151 | 80,948 | 6,567 | 102,970 |
| – to mature in subsequent years | 0 | 0 | 0 | 0 |
| Total | 12,097 | 81,226 | 18,822 | 102,970 |
| Of which | ||||
| – recognised in hedging reserve | 6,946 | 278 | 12,255 | 0 |
In certain credit events only (such as defaults), derivative financial liabilities of USD 81.2 million could have been offset against USD 12.1 million derivative financial assets and USD 59.5 million receivables (and vice versa) as at 31 December 2023 under the agreements with the derivative counterparties (2022: USD 103 million derivative financial liabilities could have been offset against USD 18.8 million derivative financial assets and vice versa).