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Glossary / continuedDesignated ReservesAmounts set aside by AHBs for specific futurecommitments and these include sinking funds for futuremaintenance requirements.Differential rentThe amount of rent paid by a tenant based onhousehold income. This varies depending on the LocalAuthority area, e.g. it could be 15% of the tenant’shousehold net income.GearingGearing is calculated as the total of loans divided byReserves and Grants. It is the ratio of Loans to Reservesincluding Capital Grants.(note – while CALF Loans are a loan due for repayment for thepurposes of this gearing ratio, they can be excluded)GrantsAmounts provided by the State and Local Authoritiesto fund the provision of social housing. These amountsare not repayable whilst the housing use remains asenvisaged. For the purposes of the Annual FinancialReturn all amounts received under the capital grantfunding regime should be included. All revenuerelated grants including Availability Paymentsshould be excluded.LiquidityLiquidity is a measure of the ability to pay debts as theyfall due and of how readily assets can be converted tocash. The Quick Ratio gives an indication of the extent ofliquidity of an organisation.LoansMonies borrowed to fund the development of housingproperties and other assets and repayable over aperiod of time to the HFA, banks or other institutions.(Includes CALF Loans).Net Interest PayableInterest payable less interest received from returnon investmentsP&A Payment and Availability AgreementsIn return for making a property available for socialhousing for a period of 10-30 years the DECLG makes anavailability payment based on market rent to the AHB.In addition the AHB is entitled to “differential rent” fromthe tenant.Quick RatioThe Quick Ratio can be used as an indicator of liquidity.It is calculated as (Debtors + cash + secured undrawnloan facilities) divided by (current liabilities) expressedas a ratio.RegulatorThe regulatory structure was established in February2014. The Housing Agency has been given responsibility,on an interim basis, for regulating Approved HousingBodies (AHBs).The Housing Agency has established a Regulation Officeto support this work. The Office reports to an interimRegulatory Committee appointed by the Minister.Sinking fundsDesignated reserves or other funds indicated on thebalance sheet as set aside for longer term systematicrepairs and refurbishment of housing stock e.groof replacement.Social Housing UnitsUnits that have been or are funded by capital or revenuegrants from the State or Local Authorities to providerents at below market levels.xliiHousing Agency Regulation Office