Complete annual report 2010-11 - Land - NSW Government

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State Property Authority Notes to and Forming Part of the Financial Statements For the Year Ended 30 June 2011 Aged Reconciliation of Total Finance 2011 2010 Lease Liabilities $'000 $'000 Minimum Lease Payments: Payable within one year 6,003 6,003 Payable later than one year but not later than five years 24,014 24,014 Payable later than five years 46,176 52,180 Total Minimum Lease Payment Commitment 76,193 82,197 Finance Costs: Payable within one year (3,504) (3,687) Payable later than one year but not later than five years (11,870) (12,762) Payable later than five years (12,706) (15,318) Total Finance Costs Commitment (28,080) (31,767) Total Finance Lease Liability: Payable within one year 2,499 2,316 Payable later than one year but not later than five years 12,144 11,252 Payable later than five years 33,470 36,862 Total Finance Lease Liability at 30 June 48,113 50,430 The Authority's Finance Lease Liabilities comprise leases on Noel Park House, Tamworth and on part of the Colonial State Bank Building, Sydney. The Noel Park House lease has a lease term of 25 years with no option to purchase the asset at the completion of the lease term in 2017. The discount rate implicit in the lease is 8.31% pa. The Colonial State Bank lease liability is being amortised over the estimated economic life of the building, which is 40 years and ends in 2026. The discount rate implicit in the lease is 7.61% pa. 15. CONTINGENT ASSETS AND LIABILITIES (a) Contingent Assets There are no known material contingent assets at 30 June 2011. (b) Contingent Liabilities There are no known material contingent liabilities at 30 June 2011. 16. FINANCIAL INSTRUMENTS The Authority’s principal financial instruments are outlined below. These financial instruments arise directly from the Authority’s operations or are required to finance the Authority’s operations. The Authority does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes. The Authority’s main risks arising from financial instruments are outlined below, together with the Authority’s objectives, policies and processes for measuring and managing risk. Further quantitative and qualitative disclosures are included throughout these financial statements. The Chief Executive Officer has overall responsibility for the establishment and oversight of risk management and reviews and agrees policies for managing risks. Risk management policies are established to identify and analyse the risks faced by the Authority, to set risk limits and controls and to monitor risks. Risk management reporting and compliance with policies is reviewed on a regular basis by the Authority's Audit and Risk Committee. 54 State Property Authority
State Property Authority 2010-2011 Annual Report State Property Authority Notes to and Forming Part of the Financial Statements For the Year Ended 30 June 2011 (a) Financial Instrument Categories 2011 2010 $'000 $'000 Financial Assets - Carrying Amounts Class Category Notes Cash and Cash Equivalents n/a 1(s)(i), 5 131,138 131,075 Receivables Loans and Receivables (at Amortised Cost) 1(s)(ii), 6 238,743 176,611 Financial Liabilities - Carrying Amounts Class Notes Payables Financial Liabilities (at Amortised Cost) 1(s)(iii), 10 19,274 19,311 Finance Leases Financial Liabilities (at Amortised Cost) 1(q)(i), 14(d) 48,113 50,430 (b) Credit Risk Credit risk arises when there is the possibility of the Authority’s debtors defaulting on their contractual obligations, resulting in a financial loss to the Authority. The maximum exposure to credit risk is generally represented by the carrying amount of the financial assets (net of any allowance for impairment). Credit risk arises from the financial assets of the Authority, including cash and receivables. No collateral is held by the Authority. The Authority has not granted any financial guarantees. All of the Authority's cash deposits are held within NSW Treasury Banking System bank accounts. All deposits held within the NSW Treasury Banking System are guaranteed by the State. The State of New South Wales has an AAA credit rating. (i) Cash Cash comprises cash on hand and bank balances within the NSW Treasury Banking System. Interest is earned on the Authority's Land Remediation Account daily bank balance at the monthly average NSW Treasury Corporation 11am unofficial cash rate, adjusted for a management fee to NSW Treasury. All other bank accounts are non-interest bearing within the NSW Treasury Banking System. (ii) Receivables - Trade Debtors All trade debtors are recognised as amounts receivable at balance date. Collectability of trade debtors is reviewed on an ongoing basis. Procedures as established in the Treasurer’s Directions are followed to recover outstanding amounts, including letters of demand. Debts which are known to be uncollectable are written off. An allowance for impairment is raised when there is objective evidence that the Authority will not be able to collect all amounts due. This evidence includes past experience, and current and expected changes in economic conditions and debtor credit ratings. No interest is earned on trade debtors. Sales are made on 30-day terms. The Authority is not materially exposed to concentrations of credit risk to a single trade debtor or group of debtors. Based on past experience, debtors which are not past due totalling $4.692 million ($4.635m at 30 June 2010) are not considered impaired and these represent 67.8% (56.4% at 30 June 2010) of the total trade debtors. Most of the Authority’s debtors are NSW Government Agencies and therefore have an AAA credit rating. There are no debtors which are currently not past due or impaired whose terms have been renegotiated. The only financial assets that are past due or impaired are trade debtors relating to property rental and fees-for-services income. These are included within Receivables in the Statement of Financial Position. 2010-2011 Annual Report 55
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State Property Authority new South
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n Letter of submission Bligh House
Page 6 and 7: n Our charter The State Property Au
Page 8 and 9: n Organisational outcomes and achie
Page 10 and 11: leasing staff generated substantial
Page 12 and 13: Other sustainability initiatives la
Page 14 and 15: n Financial performance 2010-11 Ove
Page 16 and 17: n 2010-11 Operating result operatin
Page 18 and 19: n Audited financial information Sta
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Page 22 and 23: State Property Authority Financial
Page 24 and 25: State Property Authority Statement
Page 26 and 27: State Property Authority Statement
Page 28 and 29: State Property Authority Notes to a
Page 60 and 61: n STATUTORY AND STATISTICAL INFORMA
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Page 68 and 69: Table F: Timeliness Number of appli
Page 70 and 71: n Agency contacts Postal address: G
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Complete annual report 2010-11 - Land - NSW Government

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