Table:
| NSPT Group |  |  |
| --- | --- | --- |
|  | 2019 | 2018 |
|  | $'000 | $'000 |
| Foreign currency translation reserve |  |  |
| Opening balance at 1 July | (115) | 232 |
| Net investment hedge | (1,591) | 1,007 |
| Foreign exchange translation differences | 2,464 | (1,354) |
| Closing balance at 30 June | 758 | (115) |
| Cash flow hedge reserve |  |  |
| Opening balance at 1 July | (2,073) | (45) |
| Revaluation of derivatives | (22,098) | (2,112) |
| Taxation impact on revaluation | 290 | 84 |
| Closing balance at 30 June | (23,881) | (2,073) |
| Other reserves | (23,123) | (2,188) |
Paragraphs:
The movements below in foreign currency translation reserve and cashflow hedge reserve relating to the NSPT Group are presented within non-controlling interest in the Group’s consolidated statement of changes in equity.
Taxation impact on revaluation applies only to cash flow hedges held in NSNZPT, a sub-trust of NSPT, which is subject to New Zealand tax legislation. Deferred tax does not apply to any other cash flow hedges held in the NSPT Group under current Australian tax legislation.
The hedging reserve is used to record gains or losses on derivatives that are designated as cash flow hedges and recognised in other comprehensive income, as described in note 2(m). Amounts are reclassified to profit or loss in the period when the associated hedged transaction takes place.
On 24 June 2019, the Group reset the interest rates associated with AUD denominated interest rate swaps designated as cash flow hedges. This resulted in a cash outflow of $22.9m which reduced the Group’s financial liability as presented in note 9.8. In accordance with AASB 9 Financial instruments, as the nature of the underlying hedged instrument is unchanged the fair value of this outflow remains in the cash flow hedge reserve and will be amortised to the statement of profit or loss in future periods.
The cash flow hedge is included in non-controlling interest in the Consolidated Group and is not classified within other reserves.
Question:
Where is the hedging reserve used?
Answer: record gains or losses on derivatives that are designated as cash flow hedges and recognised in other comprehensive income, as described in note 2(m).