FINANCIAL REPORT (cont.) Notes to the Financial Statements (cont.)
19. FINANCIAL INSTRUMENTS (CONT.)
Weighted average effective interest rate %
Less than 1 month $’000
1 to 3 months $’000
3 months to 5 years $’000
Total $’000
2023 Financial assets Cash and cash equivalents
0.51% 0.00%
12,833 16,815
-
-
12,833 23,099
Trade receivables
5,003
1,281
Financial liabilities Trade payables and other payables
0.00% 6.76%
5,936
11,333
218
17,487
Lease liabilities
158
321
4,006
4,485
2022 Financial assets Cash and cash equivalents
0.54% 36,746
-
-
36,746 28,946
Trade receivables
0.00%
27,661
916
369
Financial liabilities Trade payables and other payables
0.00% 4,668
12,947
1,383 3,218
18,998
Lease liabilities
5.0%
100
201
3,519
Interest rate sensitivity analysis The sensitivity analysis has been determined based on exposure to interest rates for cash and cash equivalents that were subject to interest rate fluctuations at the reporting date. At reporting date, if interest rates had been 1% higher or lower and all other variables were held constant, the Group’s profit or loss would increase or decrease by $61 thousand (2022: $163 thousand). Foreign currency risk The Group manages its foreign currency risk arising from significant supplier contracts in foreign currencies by holding foreign currency. As a result of operations in Papua New Guinea the Group’s statement of financial position can be affected by movements in the PGK/A$ exchange rate. The Group also has transactional currency exposures. Such exposure arises from sales or purchases by an operating entity in currencies other than the functional currency. Where possible, Saunders does not take on foreign exchange risk. At 30 June 2023, the Group had no forward contracts.
The Group also mitigates its exposure to foreign currency risk by minimising excess foreign currency balances in overseas jurisdictions not required for working capital. At 30 June 2023, the Group had A$77 thousand (2022: $688 thousand) of cash in PGK. At reporting date, if the PKG/AUD exchange rate had moved by 5%, with all other variables held constant, the group’s profit or loss would increase or decrease by
$4 thousand (2022: $34 thousand). Fair value of financial instruments
No financial asset or financial liability is held at fair value. The directors consider the fair value of the financial assets and financials liabilities to approximate their carrying amounts.
Annual Report 2023 85
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