Education

(c) Liquidity risk
Liquidity risk is the risk that the department will not be able to meet its financial obligations as they fall due.
The department’s approach to managing liquidity is to ensure that it will always have sufficient liquidity to meet
its liabilities when they fall due by regularly reviewing budgeted cash outflows to ensure that there is sufficient cash
to meet all obligations.
The following tables detail the undiscounted cash flows payable by the department by remaining contractual maturity
for its financial liabilities. It should be noted that as these are undiscounted, totals may not reconcile to the carrying
amounts presented in the Statement of Financial Position.
2013
Maturity analysis for financial liabilities
Financial liabilities
1 year
$'000
2 years
$'000
3 years
$'000
4 years
$'000
5 years
$'000
More than
5 years
$'000
Undiscounted
total
$'000
Carrying
amount
$'000
Payables 8,086 – – – – – 8,086 8,086
Other financial liabilities 4,458 – – – – – 4,458 4,458
Total 12,544 – – – – – 12,544 12,544
2012
Maturity analysis for financial liabilities
Financial liabilities
1 year
$'000
2 years
$'000
3 years
$'000
4 years
$'000
5 years
$'000
More than
5 years
$'000
Undiscounted
total
$'000
Carrying
amount
$'000
Payables 11,978 – – – – – 11,978 11,978
Other financial liabilities 15,106 – – – – – 15,106 15,106
Total 27,084 – – – – – 27,084 27,084
(d) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in
market prices. The primary market risk that the department is exposed to is interest rate risk.
The department currently has the majority of its financial assets in variable interest rates to take advantage of interest
rate rises.
Variable rate instruments
2013
$’000
2012
$’000
Financial assets 38,451 35,730
Total 38,451 35,730
The department does not hold any financial instruments available for sale which would directly affect equity as a result
of changes in interest rates. Changes in variable rates of 100 basis points at reporting date would have the following
effect on the department’s profit or loss.
Statement of Comprehensive Income
Equity
30 June 2013
100 basis points
increase
$'000
100 basis points
decrease
$'000
100 basis points
Increase
$'000
100 basis points
decrease
$'000
Financial assets 418 (418) 418 (418)
Net sensitivity 418 (418) 418 (418)
30 June 2012
Financial assets 449 (449) 449 (449)
Net sensitivity 449 (449) 449 (449)
This analysis assumes all other variables remain constant. The analysis was performed on the same basis as 2012.
Financial Statements » Notes
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