2012 TPSEA Annual Report - Serena Hotels

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Notes to the Financial Statements (continued) 4 Financial risk management (continued) (iii) Cash flow and fair value interest rate risk The Group has borrowings at variable rates. The Group does not hedge itself against interest rate risk. No limits are placed on the ratio of variable rate borrowing to fixed rate borrowing. At 31 December 2011, an increase/decrease of 10% on interest rate would have resulted in an increase/decrease in consolidated post tax profit of Shs 9,591,041 (2010: 5,200,403). Credit risk Credit risk arises from cash and cash equivalents and deposits with banks and financial institutions as well as credit exposures to customers, including outstanding receivables and committed transactions. Credit risk is the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The credit controller is responsible for managing and analysing credit risk for each new customer before standard payment and delivery terms are offered. Credit risk arises from cash at bank and short term deposits with banks, as well as trade and other receivables. The Group does not have any significant concentrations of credit risk. For banks and financial institutions, only reputable well established financial institutions are accepted. For trade receivables, the credit controller assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. The Group does not grade the credit quality of receivables. Individual risk limits are set based on internal ratings in accordance with limits set by the Board. The utilisation of credit limits is regularly monitored. The maximum exposure for credit risk equals the amounts disclosed on the statement of financial position in 2011 and 2010. Related party and other receivables are neither past due nor impaired. The Group’s bankers are reputable and sound financial institutions. 58 TPS EASTERN AFRICA LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS 2011
Notes to the Financial Statements (continued) 4 Financial risk management (continued) Credit risk (continued) There were no assets are past due or impaired except for the following amounts in trade receivables (which are due within 30 days of the end of the month in which they are invoiced): Group Company 2011 2010 2011 2010 Shs’000 Shs’000 Shs’000 Shs’000 Past due but not impaired: - by up to 30 days 394,294 382,587 - - - by 31 to 60 days 226,871 107,591 - - - by 61 to 90 days 3,678 14,678 - - - by over 90 days 21,806 67,682 - - Total past due but not impaired 646,649 572,538 - - Impaired and fully provided for 64,637 50,239 - - Liquidity risk Prudent liquidity risk management includes maintaining sufficient cash securities, and the availability of funding from an adequate amount of committed credit facilities. Due to the dynamic nature of the underlying businesses, Management maintains flexibility in funding by maintaining availability under committed credit lines. Management monitors rolling forecasts of the Group’s liquidity reserve on the basis of expected cash flows. The table below analyses the Group’s and the Company’s financial liabilities into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date. The amounts disclosed in the table below are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances, as the impact of discounting is not significant. (a) Group less than 1 Between 1 Between 2 Over 5 year and 2 years and 5 years years Shs’000 Shs’000 Shs’000 Shs’000 At 31 December 2011: - borrowings net of interest 466,694 531,857 1,127,515 - - trade and other payables 1,139,017 - - - - interest on borrowings 171,685 133,998 102,020 - At 31 December 2010: - borrowings net of interest 420,757 366,427 838,097 - - trade and other payables 1,205,488 - - - - interest on borrowings 115,307 129,360 242,293 - (a) Company At 31 December 2011: - trade and other payables 4,881 - - - At 31 December 2010: - trade and other payables 5,760 - - - TPS EASTERN AFRICA LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS 2011 59
Page 1:
2011 Annual Report and Accounts
Page 4 and 5:
Directors and Administration BOARD
Page 6 and 7:
Operating Subsidiaries and Properti
Page 8 and 9: Notice of Annual General Meeting No
Page 10 and 11: Chairman’s Statement Mr. Francis
Page 12 and 13: Chairman’s Statement (continued)
Page 14 and 15: Taarifa ya Mwenyekiti (kuendelea) u
Page 16 and 17: The Managing Director’s Report Mr
Page 18 and 19: The Managing Director’s Report (c
Page 20 and 21: Taarifa kutoka kwa Meneja Mkurugenz
Page 22 and 23: Board of Directors 1 MR. FRANCIS OK
Page 24 and 25: Corporate Governance Statement The
Page 26 and 27: Corporate Governance Statement (con
Page 28 and 29: Corporate Social Responsibility At
Page 30 and 31: Charitable Donations Serena and its
Page 32 and 33: Directors’ Report The Directors s
Page 34 and 35: Report of the Independent Auditor t
Page 36 and 37: Consolidated Statement of Comprehen
Page 38 and 39: Company Statement of Financial Posi
Page 40 and 41: Consolidated Statement of Changes i
Page 42 and 43: Company Statement of Changes in Equ
Page 44 and 45: Notes to the Financial Statements 1
Page 46 and 47: Notes to the Financial Statements (
Page 84 and 85: Notes
Page 86: FOLD 1 / KUNJA 1 Please afix Stamp
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2012 TPSEA Annual Report - Serena Hotels

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