Financial Instruments

12 Months Ended

Dec. 31, 2019

8	FINANCIAL INSTRUMENTS

8.1	Financial instruments by category

The classification of financial assets and liabilities by category is as follows:


	At December, 31
	2018		2019
Financial assets according to the statement of financial position
Loans and accounts receivable at amortized cost:
- Cash and cash equivalents		801,140		948,978
- Trade accounts receivable and other accounts receivable (excluding financial assets)		1,302,358		1,258,476
- Financial assets related to concession agreements		1,227,994		748,365
- Accounts receivable from related parties		813,129		36,658

		4,144,621		2,992,477

Financial assets related to concession agreements are recorded in the consolidated statement of financial position as the line items short-term trade accounts receivable and long-term trade accounts receivable.


	At December, 31
	2018		2019
Financial liabilities according to the statement of financial position
Other financial liabilities at amortized cost:
- Other financial liabilities		1,169,184		695,870
- Finance leases		33,488		22,980
- Lease liability for right-of-use asset		—		80,216
- Bonds		937,042		924,042
- Trade and other accounts payable (excluding non-financial liabilities)		1,453,933		1,364,131
- Accounts payable to related parties		77,790		61,499

		3,671,437		3,148,738

Hedging derivatives:
- Derivative financial instruments		61		52

8.2	Credit quality of financial assets

The credit quality of financial assets that are neither past due nor impaired can be assessed with reference to external risk ratings (if they exist), or based on historical information on the default rates of their counterparties.

As of December 31, the credit quality of financial assets is presented below:


	At December 31,
	2018		2019
Cash and cash equivalents (*)
Banco de Credito del Peru (A+)		350,403		302,743
Banco Continental (A+)		114,067		186,238
Citibank (A)		134,990		183,719
Banco Scotiabank (A+)		73,039		64,101
Banco de la Nacion (A)		23,766		56,085
Credicorp Capital Colombia (AAA)		—		44,338
Banco Interbank (A)		14,075		41,681
JP Morgan (AAA)		257		17,853
Santander Colombia (AAA)		—		15,183
Banco Scotiabank - Chile (A+)		—		9,801
Banco Bogota (BB+)		16,782		7,255
Banco Santander - Chile (AAA)		3,325		5,817
Banco Santander - Perú (A)		12,221		114
Fondo de Inversion Alianza (AA+)		39,051		46
Banco de crédito e Inversiones - Chile (AA+)		5,909		—
Others		8,312		7,017

		796,197		941,991

The risk ratings in the previous table of “A” and “AAA” represent high quality ratings. For banks in Peru, these risk ratings are obtained from the risk rating agencies authorized by the Superintendence of Banking, Insurance and AFP (SBS). For banks in Chile, ratings are obtained from the risk rating agencies authorized by the Superintendence of Securities and Insurance (SVS) of Chile (Fitch Chile Clasificadora de Riesgo Ltda. and ICR International Credit Rating Cia Clasificadora de Riesgo Ltda.). For banks in Colombia, ratings are obtained from the following financial institutions: Fitch Ratings, Value and Risk Rating S.A., BRC Standard and Poor’s Rating and Technical Committe

of BRC Investor Services S.A. SCV.

(*)	The difference between the balances shown and the balances of the statement of financial position correspond to cash and remittances in transit (Note 9).

The credit quality of customers is assessed in three categories (internal classification):

New customers/related parties (less than six months),

Existing customers/related parties (with more than six months of trade relationship) with no previous default history; and

Existing customers/related parties (with more than six months of trade relationship) with previous default history.


	2018		2019
Trade accounts receivable (Note 10)
Counterparties with no external risk rating
A		302,369		58,999
B		1,579,400		1,373,424
C		146,126		142,516

		2,027,895		1,574,939

Receivable from related parties and joint operators (Note 12)
B		813,129		583,599

The total balance of trade accounts receivable and accounts receivable from related parties is subject to the terms and conditions of the respective contract, none of which has been renegotiated.