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140 ENAV – 2014 Financial Statements

Sensitivity Analysis

Type of transaction Fair value Difference NE Difference NE
Forward purchase Eur/USD rate +5% Eur/USD rate -5%

1,863 2,983 1,128

33. Risk management

Credit risk

The ENAV Group’s credit risk at 31 December 2014 is represented by
the carrying amount of current trade receivables due from customers,
which represent its highest financial statement exposure. A bad debts
allowance is recognized against customer non-performance risk which
mainly relates to Eurocontrol, the collection agent for air carriers. The
balance on this allowance is reviewed on a regular basis, including on the
basis of information provided by Eurocontrol itself on route and terminal
receivables. The process followed by ENAV for writing down receivables
consists of making write-downs of individual customer balances that
depend on the financial situation of the carrier concerned, flight license
withdrawal and the age of the receivable. At 31 December 2014 the
portion of trade receivables due from customers, including management
companies, which is considered of doubtful recovery is fully covered by the
bad debts allowance.

Liquidity risk

Liquidity risk is the risk that the although still solvent Group may be
unable to meet its planned and contingent payment obligations in a timely
manner due to difficulty in obtaining funds, or that it is only able to do
so under unfavorable economic conditions due to factors connected with
the market’s perception of its riskiness. The Group’s liquidity is generally
managed and monitored by the parent company at an essentially
centralized level in order to optimize the overall availability of funds. The
parent company performs management and control functions over the
companies of the Group that are able to obtain direct access to market
funding sources, primarily taking care of their requirements with cash
flows generated by ordinary operations, using a variety of funding sources
as well as at the same time ensuring that any excess cash is appropriately
managed. On the basis of general guidelines set by senior management,
the administration, finance and control department establishes the short-
term and medium/long-term financial structure and the way in which
the relative cash flows will be managed. Decisions are mainly directed
towards: i) ensuring the availability of adequate funds for planned short-
term operating commitments, systematically monitored through a treasury
planning and forecast revision activity; ii) keeping an adequate liquidity
buffer that is sufficient for dealing with any unexpected commitments; iii)