72 LV= Annual Report 2012
Notes to the Financial Statements continued
31 December 2012
3. Risk management and control (continued)
Within 1 1-3 3-5 Over 5
Society year years years years Linked Total
Maturity profile of financial liabilities 2012 £m £m £m £m £m £m
Insurance contract liabilities 77.3 104.0 164.4 6,180.6 77.0 6,603.3
Investment contract liabilities – – – – 959.3 959.3
Provisions 57.8 5.0 0.3 – – 63.1
Financial liabilities
- Derivative financial instruments – – – 51.2 – 51.2
- Other financial liabilities 65.6 0.6 0.5 14.7 – 81.4
Insurance payables 26.2 – – – – 26.2
Trade and other payables 136.2 – – – – 136.2
363.1 109.6 165.2 6,246.5 1,036.3 7,920.7
Within 1 1-3 3-5 Over 5
Society year years years years Linked Total
Maturity profile of financial liabilities 2011 £m £m £m £m £m £m
Insurance contract liabilities 107.8 190.3 184.7 5,405.8 57.6 5,946.2
Investment contract liabilities – – – – 800.9 800.9
Provisions 5.1 46.8 0.4 – – 52.3
Financial liabilities
- Derivative financial instruments – 3.8 – – – 3.8
- Other financial liabilities 66.8 5.9 – – – 72.7
Insurance payables 31.6 – – – – 31.6
Trade and other payables 147.4 – – – – 147.4
358.7 246.8 185.1 5,405.8 858.5 7,054.9
iv) Other risk types
Operational risk
Operational risk is the risk of loss, resulting from inadequate or failed internal processes, systems, human error or from external events,
including legal and regulatory risk.
Senior managers are responsible for the identification, assessment, control and monitoring of operational risks and for reporting these to the
Risk Committee in accordance with the Group’s escalation criteria. Operational risks are assessed in terms of their probability and impact in
accordance with Group policy.
Group risk
Group risk is the risk of contagion that the Society incurs from its membership of a group of firms. The Group Risk Committee oversees the
management of such risks.
Strategic risk
Strategic risk is the risk arising from the implementation of agreed strategy. It includes risks arising from political, economic, sociological and
technological changes, competitor actions and capital adequacy.
Executive management identifies strategic risks when drawing up business plans for approval by the Board and monitors these, ensuring that
excess risk is reported to the Group Risk Committee and Board.