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Financial Instruments | 12 Months Ended
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Dec. 31, 2017
Financial instruments [Abstract] |
Disclosure of financial instruments [text block] | Note 7 Financial Instruments Financial instruments categories The carrying amounts of each financial instrument category as of each year-end are detailed as follows:
|  | As of December 31, 2017 |  | As of December 31, 2016 |
|  | Current |  | Non current |  | Current |  | Non current |
|  | ThCh$ |  | ThCh$ |  | ThCh$ |  | ThCh$ |
Derivative financial instruments |  |  | 3,158,391 |  |  | - |  |  | 479,492 |  |  | - |
Market securities and investments in other companies |  |  | 7,565,805 |  |  | - |  |  | 7,821,546 |  |  | - |
Derivative hedge assets |  |  | - |  |  | 1,918,191 |  |  | 105,453 |  |  | 203,784 |
Total other financial assets |  |  | 10,724,196 |  |  | 1,918,191 |  |  | 8,406,491 |  |  | 203,784 |
Cash and cash equivalents |  |  | 170,044,602 |  |  | - |  |  | 134,033,183 |  |  | - |
Accounts receivable - trade and other receivable (net) |  |  | 286,213,598 |  |  | 3,330,606 |  |  | 280,788,133 |  |  | 3,563,797 |
Acoounts receivable from related companies |  |  | 5,810,764 |  |  | 258,471 |  |  | 3,536,135 |  |  | 356,665 |
Total financial assets |  |  | 472,793,160 |  |  | 5,507,268 |  |  | 426,763,942 |  |  | 4,124,246 |
Bank borrowings |  |  | 24,623,746 |  |  | 73,886,831 |  |  | 39,079,561 |  |  | 29,606,398 |
Bonds payable |  |  | 3,306,135 |  |  | 69,476,612 |  |  | 3,250,023 |  |  | 70,836,716 |
Financial leases obligations |  |  | 176,586 |  |  | 17,638,289 |  |  | 215,950 |  |  | 17,500,919 |
Derivative hedge liabilities |  |  | 10,416,675 |  |  | - |  |  | 11,118,676 |  |  | - |
Liability coverage |  |  | 1,840,188 |  |  | - |  |  | - |  |  | - |
Deposits for return of bottles and containers |  |  | 13,228,328 |  |  | - |  |  | 13,015,723 |  |  | - |
Total other non-financial liabililities (*) |  |  | 53,591,658 |  |  | 161,001,732 |  |  | 66,679,933 |  |  | 117,944,033 |
Account payable- trade and other payable |  |  | 281,681,553 |  |  | 541,783 |  |  | 259,739,479 |  |  | 1,082,898 |
Accounts payable to related entities |  |  | 10,069,043 |  |  | - |  |  | 9,530,071 |  |  | - |
Total financial liabilities |  |  | 345,342,254 |  |  | 161,543,515 |  |  | 335,949,483 |  |  | 119,026,931 |
(*) See Note 21 - Other financial liabilities. Fair vaue of Financial instruments
a) | Financial assets and liabilities are detailed as follows:
The following tables show fair values, based on financial instrument categories, compared to the carrying amount included in the Consolidated Statements of Financial Position:
|  | As of December 31, 2017 |  | As of December 31, 2016 |
|  | Book Value |  | Fair Value |  | Book Value |  | Fair Value |
|  | ThCh$ |  | ThCh$ |  | ThCh$ |  | ThCh$ |
Derivative financial instruments |  |  | 3,158,391 |  |  | 3,158,391 |  |  | 479,492 |  |  | 479,492 |
Market securities and investments in other companies |  |  | 7,565,805 |  |  | 7,565,805 |  |  | 7,821,546 |  |  | 7,821,546 |
Derivative hedge assets |  |  | 1,918,191 |  |  | 1,918,191 |  |  | 309,237 |  |  | 309,237 |
Total other financial assets |  |  | 12,642,387 |  |  | 12,642,387 |  |  | 8,610,275 |  |  | 8,610,275 |
Cash and cash equivalents |  |  | 170,044,602 |  |  | 170,044,602 |  |  | 134,033,183 |  |  | 134,033,183 |
Accounts receivable - trade and other receivable (net) |  |  | 289,544,204 |  |  | 289,544,204 |  |  | 284,351,930 |  |  | 284,351,930 |
Acoounts receivable from related companies |  |  | 6,069,235 |  |  | 6,069,235 |  |  | 3,892,800 |  |  | 3,892,800 |
Total financial assets |  |  | 478,300,428 |  |  | 478,300,428 |  |  | 430,888,188 |  |  | 430,888,188 |
Bank borrowings |  |  | 98,510,577 |  |  | 102,062,465 |  |  | 68,685,959 |  |  | 69,668,649 |
Bonds payable |  |  | 72,782,747 |  |  | 79,559,896 |  |  | 74,086,739 |  |  | 81,769,096 |
Financial leases obligations |  |  | 17,814,875 |  |  | 29,314,234 |  |  | 17,716,869 |  |  | 30,154,204 |
Derivative hedge liabilities |  |  | 10,416,675 |  |  | 10,416,675 |  |  | 11,118,676 |  |  | 11,118,676 |
Liability coverage |  |  | 1,840,188 |  |  | 1,840,188 |  |  | - |  |  | - |
Deposits for return of bottles and containers |  |  | 13,228,328 |  |  | 13,228,328 |  |  | 13,015,723 |  |  | 13,015,723 |
Total other non-financial liabililities (*) |  |  | 214,593,390 |  |  | 236,421,786 |  |  | 184,623,966 |  |  | 205,726,348 |
Account payable- trade and other payable |  |  | 282,223,336 |  |  | 282,223,336 |  |  | 260,822,377 |  |  | 260,822,377 |
Accounts payable to related entities |  |  | 10,069,043 |  |  | 10,069,043 |  |  | 9,530,071 |  |  | 9,530,071 |
Total financial liabilities |  |  | 506,885,769 |  |  | 528,714,165 |  |  | 454,976,414 |  |  | 476,078,796 |
(*) See Note 21 - Other financial liabilities. The carrying amount of current accounts receivable, cash and cash equivalents and other financial assets and liabilities approximate their fair value due to their short-term nature, and in the case of accounts receivable, due to the fact that any collection loss is already reflected in the impairment loss provision. The fair value of non-derivative financial assets and liabilities that are not quoted in active markets are estimated through the use of discounted cash flows calculated on market variables observed as of the date of the financial statements. The fair value of derivative instruments is estimated through the discount of future cash flows, determined according to information observed in the market or to variables and prices obtained from third parties. The fair value of bank borrowings and Bonds payable has hierarchy level 2 of fair value. b) Financial instruments by category:
As of December 31, 2017 |  | Fair value with changes in income |  | Cash and cash equivaletns and loans and accounts receivables |  | Hedge derivatives |  | Total |
|  | ThCh$ |  | ThCh$ |  | ThCh$ |  | ThCh$ |
Financial assets |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial instruments |  |  | 3,158,391 |  |  | - |  |  | - |  |  | 3,158,391 |
Marketable securities and investments in other companies |  |  | 7,565,805 |  |  | - |  |  | - |  |  | 7,565,805 |
Derivative hedge assets |  |  | - |  |  | - |  |  | 1,918,191 |  |  | 1,918,191 |
Total other financial assets |  |  | 10,724,196 |  |  | - |  |  | 1,918,191 |  |  | 12,642,387 |
Cash and cash equivalents |  |  | - |  |  | 170,044,602 |  |  | - |  |  | 170,044,602 |
Trade and other current receivables (net) |  |  | - |  |  | 289,544,204 |  |  | - |  |  | 289,544,204 |
Account receivable from to related companies |  |  | - |  |  | 6,069,235 |  |  | - |  |  | 6,069,235 |
Total |  |  | 10,724,196 |  |  | 465,658,041 |  |  | 1,918,191 |  |  | 478,300,428 |
As of December 31, 2017 |  | Fair value with changes in income |  | Hedge derivatives |  | Financial libilities measured at amortized cost |  | Total |
|  | ThCh$ |  | ThCh$ |  | ThCh$ |  | ThCh$ |
Financial liabilities |  |  |  |  |  |  |  |  |  |  |  |  |
Bank borrowings |  |  | - |  |  | - |  |  | 98,510,577 |  |  | 98,510,577 |
Bonds payable |  |  | - |  |  | - |  |  | 72,782,747 |  |  | 72,782,747 |
Financial leases obligations |  |  | - |  |  | - |  |  | 17,814,875 |  |  | 17,814,875 |
Derivative financial instruments |  |  | 10,416,675 |  |  | - |  |  | - |  |  | 10,416,675 |
Liability coverage |  |  | - |  |  | 1,840,188 |  |  | - |  |  | 1,840,188 |
Deposits for return of bottles and containers |  |  | - |  |  | - |  |  | 13,228,328 |  |  | 13,228,328 |
Total others financial liabililities |  |  | 10,416,675 |  |  | 1,840,188 |  |  | 202,336,527 |  |  | 214,593,390 |
Account payable- trade and other payable |  |  | - |  |  | - |  |  | 282,223,336 |  |  | 282,223,336 |
Accounts payable to related entities |  |  | - |  |  | - |  |  | 10,069,043 |  |  | 10,069,043 |
Total |  |  | 10,416,675 |  |  | 1,840,188 |  |  | 494,628,906 |  |  | 506,885,769 |
As of December 31, 2016 |  | Fair value with changes in income |  | Cash and cash equivaletns and loans and accounts receivables |  | Hedge derivatives |  | Total |
|  | ThCh$ |  | ThCh$ |  | ThCh$ |  | ThCh$ |
Financial assets |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial instruments |  |  | 479,492 |  |  | - |  |  | - |  |  | 479,492 |
Marketable securities and investments in other companies |  |  | 7,821,546 |  |  | - |  |  | - |  |  | 7,821,546 |
Derivative hedge assets |  |  | - |  |  | - |  |  | 309,237 |  |  | 309,237 |
Total other financial assets |  |  | 8,301,038 |  |  | - |  |  | 309,237 |  |  | 8,610,275 |
Cash and cash equivalents |  |  | - |  |  | 134,033,183 |  |  | - |  |  | 134,033,183 |
Trade and other current receivables (net) |  |  | - |  |  | 284,351,930 |  |  | - |  |  | 284,351,930 |
Account receivable from to related companies |  |  | - |  |  | 3,892,800 |  |  | - |  |  | 3,892,800 |
Total |  |  | 8,301,038 |  |  | 422,277,913 |  |  | 309,237 |  |  | 430,888,188 |
As of December 31, 2016 |  | Fair value with changes in income |  | Hedge derivatives |  | Financial libilities measured at amortized cost |  | Total |
|  | ThCh$ |  | ThCh$ |  | ThCh$ |  | ThCh$ |
Financial liabilities |  |  |  |  |  |  |  |  |  |  |  |  |
Bank borrowings |  |  | - |  |  | - |  |  | 68,685,959 |  |  | 68,685,959 |
Bonds payable |  |  | - |  |  | - |  |  | 74,086,739 |  |  | 74,086,739 |
Financial leases obligations |  |  | - |  |  | - |  |  | 17,716,869 |  |  | 17,716,869 |
Derivative financial instruments |  |  | 11,118,676 |  |  | - |  |  | - |  |  | 11,118,676 |
Deposits for return of bottles and containers |  |  | - |  |  | - |  |  | 13,015,723 |  |  | 13,015,723 |
Total others financial liabililities |  |  | 11,118,676 |  |  | - |  |  | 173,505,290 |  |  | 184,623,966 |
Account payable- trade and other payable |  |  | - |  |  | - |  |  | 260,822,377 |  |  | 260,822,377 |
Accounts payable to related entities |  |  | - |  |  | - |  |  | 9,530,071 |  |  | 9,530,071 |
Total |  |  | 11,118,676 |  |  | - |  |  | 443,857,738 |  |  | 454,976,414 |
Derivative Instruments The detail of maturities, number of derivative agreements, contracted nominal amounts, fair values and the classification of such derivative instruments by type of agreement at the closing of each year are detailed as follows:
|  | As of December 31, 2017 |  | As of December 31, 2016 |
|  | Number |  | Nominal amounts |  | Asset |  | Liability |  | Number |  | Nominal amounts |  | Asset |  | Liability |
|  | agreements |  | thousand |  | ThCh$ |  | ThCh$ |  | agreements |  | thousand |  | ThCh$ |  | ThCh$ |
Cross currency interest rate swaps CLP/USD |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 1 |  |  | 7,427,407 |  |  | 53,743 |  |  | - |
Less than a year |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 1 |  |  | 7,427,407 |  |  | 53,743 |  |  | - |
Cross interest rate swaps UF/CLP |  |  | 1 |  |  | 2,000 |  |  | 1,918,191 |  |  | 1,484,538 |  |  | - |  |  | - |  |  | - |  |  | - |
Less than a year |  |  | - |  |  | - |  |  | - |  |  | 1,484,538 |  |  | - |  |  | - |  |  | - |  |  | - |
Between 1 and 5 years |  |  | - |  |  | 2,000 |  |  | 1,918,191 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |
More than 5 years |  |  | 1 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |
Cross currency interest rate swaps USD/EURO |  |  | 1 |  |  | 7,878 |  |  | - |  |  | 355,650 |  |  | 1 |  |  | 7,876 |  |  | 255,494 |  |  | - |
Less than a year |  |  | 1 |  |  | 7,878 |  |  | - |  |  | 355,650 |  |  | - |  |  | - |  |  | 51,710 |  |  | - |
Between 1 and 5 years |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 1 |  |  | 7,876 |  |  | 203,784 |  |  | - |
Total |  |  | 2 |  |  |  |  |  | 1,918,191 |  |  | 1,840,188 |  |  | 2 |  |  |  |  |  | 309,237 |  |  | - |
Forwards USD |  |  | 27 |  |  | 245,641 |  |  | 3,095,825 |  |  | 9,722,619 |  |  | 29 |  |  | 224,332 |  |  | 359,254 |  |  | 10,586,653 |
Less than a year |  |  | 27 |  |  | 245,641 |  |  | 3,095,825 |  |  | 9,722,619 |  |  | 29 |  |  | 224,332 |  |  | 359,254 |  |  | 10,586,653 |
Forwards Euro |  |  | 14 |  |  | 65,598 |  |  | 44,474 |  |  | 694,056 |  |  | 10 |  |  | 49,421 |  |  | 109,164 |  |  | 523,079 |
Less than a year |  |  | 14 |  |  | 65,598 |  |  | 44,474 |  |  | 694,056 |  |  | 10 |  |  | 49,421 |  |  | 109,164 |  |  | 523,079 |
Forwards CAD |  |  | 3 |  |  | 1,750 |  |  | 15,530 |  |  | - |  |  | 2 |  |  | 1,480 |  |  | 11,074 |  |  | 7,720 |
Less than a year |  |  | 3 |  |  | 1,750 |  |  | 15,530 |  |  | - |  |  | 2 |  |  | 1,480 |  |  | 11,074 |  |  | 7,720 |
Forwards GBP |  |  | 2 |  |  | 480 |  |  | 2,562 |  |  | - |  |  | 2 |  |  | 700 |  |  | - |  |  | 1,224 |
Less than a year |  |  | 2 |  |  | 480 |  |  | 2,562 |  |  | - |  |  | 2 |  |  | 700 |  |  | - |  |  | 1,224 |
Total |  |  | 46 |  |  |  |  |  | 3,158,391 |  |  | 10,416,675 |  |  | 43 |  |  |  |  |  | 479,492 |  |  | 11,118,676 |
Total instruments |  |  | 48 |  |  |  |  |  | 5,076,582 |  |  | 12,256,863 |  |  | 45 |  |  |  |  |  | 788,729 |  |  | 11,118,676 |
These derivative agreements have been entered into as a hedge of exchange rate risk exposure. In the case of forwards, the Company does not comply with the formal requirements for hedging designation; consequently their effects are recorded in Income, in Other gains (losses). In the case of Cross Currency Interest Rate Swaps and the Cross Interest Rate Swaps, these qualify as cash flow hedges of the cash flows related to loans from Banco de Chile and Banco Scotiabank. See additional disclosures in Note 21.
As of December 31, 2017 |
Entity |  | Nature of risks covered |  | Rights |  | Obligations |  | Fair value of net asset (liabilities) |  | Maturity |
|  |  |  | Currency |  | Amount |  | Currency |  | Amount |  | Amount |  |  |
|  |  |  |  |  | ThCh$ |  |  |  | ThCh$ |  | ThCh$ |  |  |
Scotiabank Chile |  | Flow interest rate and exchange rate on bank bonds |  | USD |  |  | 4,860,845 |  | EUR |  |  | 5,216,495 |  |  | (355,650) |  | 06-18-2018 |
Banco de Chile |  | Flow interest rate on bank bonds |  | UF |  |  | 60,640,827 |  | CLP |  |  | 60,207,174 |  |  | 433,653 |  | 09-15-2021 |
As of December 31, 2016 |
Entity |  | Nature of risks covered |  | Rights |  | Obligations |  | Fair value of net asset (liabilities) |  | Maturity |
|  |  |  | Currency |  | Amount |  | Currency |  | Amount |  | Amount |  |  |
|  |  |  |  |  | ThCh$ |  |  |  | ThCh$ |  | ThCh$ |  |  |
Scotiabank Chile |  | Flow interest rate and exchange rate on bank bonds |  | USD |  |  | 5,335,826 |  | EUR |  |  | 5,080,332 |  |  | 255,494 |  | 06-18-2018 |
Banco de Chile |  | Flow interest rate on bank bonds |  | CLP |  |  | 7,458,187 |  | USD |  |  | 7,404,444 |  |  | 53,743 |  | 07-03-2017 |
The Consolidated Statement of Other Comprehensive Income includes under the caption cash flow hedge, for the years ended December 31, 2017, a charge before income taxes of ThCh$ 5,661 (credit of ThCh$ 84,962 and ThCh$ 80,693, in 2016 and 2015, respectively), related to the fair value of Cross Currency Interest Swap and Cross Interest Rate Swap derivatives instruments. Fair value hierarchies The financial instruments recorded at fair value in the Statement of Financial Position are classified as follows, depending on the method used to obtain their fair values:
| Level 1 | Fair values obtained through direct reference to quoted market prices, without any adjustment.
| Level 2 | Fair values obtained through the use of valuation models accepted in the market and based on prices other than those of Level 1, which may be directly or indirectly observed as of the measurement date (adjusted prices).
| Level 3 | Fair values obtained through internally developed models or methodologies that use information which may not be observed or which is illiquid.
The fair value of financial instruments recorded at fair value in the Consolidated Financial Statements, is detailed as follows:
|  | Recorded fair |  | Fair value hierarchy |
As of December 31, 2017 |  | value |  | level 1 |  | level 2 |  | level 3 |
|  | ThCh$ |  | ThCh$ |  | ThCh$ |  | ThCh$ |
Derivative financial instruments |  |  | 3,158,391 |  |  | - |  |  | 3,158,391 |  |  | - |
Market securities and investments in other companies |  |  | 7,565,805 |  |  | 7,565,805 |  |  | - |  |  | - |
Derivative hedge assets |  |  | 1,918,191 |  |  | - |  |  | 1,918,191 |  |  | - |
Fair value financial assets |  |  | 12,642,387 |  |  | 7,565,805 |  |  | 5,076,582 |  |  | - |
Derivative hedge liabilities |  |  | 1,840,188 |  |  | - |  |  | 1,840,188 |  |  | - |
Derivative financial instruments |  |  | 10,416,675 |  |  | - |  |  | 10,416,675 |  |  | - |
Fair value financial liabilities |  |  | 12,256,863 |  |  | - |  |  | 12,256,863 |  |  | - |
|  | Recorded fair |  | Fair value hierarchy |
As of December 31, 2016 |  | value |  | level 1 |  | level 2 |  | level 3 |
|  | ThCh$ |  | ThCh$ |  | ThCh$ |  | ThCh$ |
Derivative financial instruments |  |  | 479,492 |  |  | - |  |  | 479,492 |  |  | - |
Market securities and investments in other companies |  |  | 7,821,546 |  |  | 7,821,546 |  |  | - |  |  | - |
Derivative hedge assets |  |  | 309,237 |  |  | - |  |  | 309,237 |  |  | - |
Fair value financial assets |  |  | 8,610,275 |  |  | 7,821,546 |  |  | 788,729 |  |  | - |
Derivative financial instruments |  |  | 11,118,676 |  |  | - |  |  | 11,118,676 |  |  | - |
Fair value financial liabilities |  |  | 11,118,676 |  |  | - |  |  | 11,118,676 |  |  | - |
During the year ended as of December 31, 2017, the Company has not made any significant instrument transfers between levels 1 and 2. Credit quality of financial assets The Company uses two credit assessment systems for its clients: a) Clients with loan insurance are assessed according to the external risk criteria (trade reports, non-compliance and protested documents that are available in the local market), payment capability and equity situation required by the insurance company to grant a loan coverage; b) All other the clients are assessed through an ABC risk model, which considers internal risk (non-compliance and protested documents), external risk (trade reports, non-compliance and protested documents that are available in the local market) and payment capacity and equity situation. The uncollectible rate during the last two years has not been significant.

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