Corporate Report for the year ended 30 June 2022
Introduction and overview
Business performance
Governance and risk
Directors’ report
Remuneration report
Financial statements
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Section B: Notes to the Group financial statements for the year ended 30 June 2022
Section B: Notes to the Group financial statements for the year ended 30 June 2022
B8 Working capital The Group’s working capital balances are summarised as follows:
2022
2021
Note
$M
$M
Current assets Cash and cash equivalents
2,020
4,285
Trade and other receivables Prepayments
36
283 145 116
Trade receivables Other receivables
169 112
Concession financial asset
B18
30
28
347
572
Current liabilities Trade and other payables
(463) (463)
(397) (397)
Net working capital
1,904
4,460
Cash and cash equivalents For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Bank overdrafts are shown within borrowings in current liabilities. All cash balances are interest bearing. The amount shown in cash and cash equivalents includes $95 million not available for general use as at 30 June 2022 (2021: $87 million) of which $28 million (2021: $24 million) belongs to TIL. This comprises amounts required to be held in a construction account, maintenance and funding reserves and prepaid tolls. Prepayments From time to time the Group makes advance payments to its D&C subcontractors, not necessarily stipulated in the D&C subcontract itself, to facilitate the progression of its construction projects. Included within current and non-current prepayments as at 30 June 2021 were advance payments of $253 million and $190 million, respectively to the West Gate Tunnel Project D&C Subcontractor. During the financial year, the advance payments have been utilised to pay for certified West Gate Tunnel Project works and partially settle the State Loan liability, as part of the settlement finalised on 23 March 2022 with the State of Victoria and D&C Subcontractor on revised terms for the delivery of the West Gate Tunnel Project. Trade receivables Trade receivables are recognised initially at the amount of consideration that is unconditional unless they contain significant financing components in which case they are recognised at fair value. The Group holds the trade receivables with the objective to collect the contractual cash flows and therefore measures them subsequently at amortised cost using the effective interest method. Trade receivables are generally due for settlement no more than 30 days from revenue recognition. The Group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime of expected loss allowance for all trade receivables. The expected loss rates are based on the payment profiles of toll revenue over historical periods and the corresponding historical credit losses experienced. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of customers to settle the receivables. As at 30 June 2022, the expected loss rates incorporate forward-looking information about the economic uncertainty relating to the impacts of COVID-19, near-term interest rates and inflation. Such forward-looking information reflects management’s estimate based on the information available as at 30 June 2022.
143 143
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