....talking of fundamentals.............., page-5

I am a new poster, but I can help with this query.

Financial accounting requires that FX losses are brought to account on a translation basis. That means you compare the price of currency on two different dates (i.e. start of the financial year and end of the finacial year) and the difference (measured in $AUD)is translated as a gain or loss - assuming MEO's functional currency is $AUD, which I have no reason to doubt.

Translation is different to realisation; the former is a 'book or paper' loss while the latter is a real cash loss. Realisation would ocurr when an event occurs such such as an exchange of currency.

I note that the bulk of the FX loss relates to cash and cash equivalents. MEO must hold most of its cash and cash equvalents in a foreign currency; prbably $US.

Hedging is usually undertaken for in respect of foreing currency denominated debt. It is less usual to hedge foreign currency assets such as foreign currency, particulalryas it is a current asset. Hedging costs money and sometimes it is more prudent to take the risk than incur the cost.

Hope this answers the query.

I hold MEO.