GCS ANNUAL REPORT 2014

FOR THE FINANCIAL YEAR ENDED 30 JUNE 2014
Weighted
average
interest rate
%
1 year
or less
$’000
2-5 years
or less
%
2014
Financial assets
Cash and cash equivalents 2.40 13,808 - 13,808
Financial liabilities
Borrowings 5.27 (2,000) (25,340) (27,340)
Total 11,808 (25,340) (13,532)
Total
$’000
2013
Financial assets
Cash and cash equivalents 3.17 15,317 - 15,317
Financial liabilities
Borrowings 5.03 (1,000) (23,840) (24,840)
Total 14,317 (23,840) (9,523)
Group sensitivity
As at 30 June 2013 and 2014, a sensitivity analysis has not been disclosed in relation to the floating interest deposits for the Group, as the net results of a reasonable possible change in interest rates
have been determined to be immaterial to the statement of profit or loss and other comprehensive income.
b. Credit risk
Credit risk is the risk of financial loss to the Group if a customer of counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Group’s trade and other
receivables. The Group has adopted the policy of only dealing with recognised creditworthy counterparties and obtaining sufficient collateral or guarantees where appropriate, as a means of mitigating
the risk of financial loss from defaults. If customers are independently rated, these ratings are used. Otherwise, if there is no independent rating, risk control assesses the credit quality of the customer,
taking into account its financial position, past experience and other factors. The compliance with credit limits by customers is regularly monitored by line management. The Group measures credit risk
on a fair value basis.
Trade and other receivables
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each counterparty.
The Group has established an allowance for impairment that represents an estimate of incurred losses in respect of trade and other receivables. The main components of this allowance are a specific
loss component that relates to individually significant exposures as at 30 June 2014.
The Group/s range of customers are mainly exposed to the construction industry. The Group’s risk is reduced by exposure to the Residential, Commercial, and Resource, Industrial, Oil & Gas sectors
of the construction industry. The Group has a significant risk exposure to one customer. The maximum amount of exposure at 30 June 2014 to the one customer is $3.68m (2013: $3.7m).
GLOBAL CONSTRUCTION SERVICES LIMITED ANNUAL REPORT 2014
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