YUTE Annual Report 2014

YOUTH UPLIFTMENT THROUGH EMPLOYMENT LIMITED (YUTE)
Page 15
NOTES TO THE FINANCIAL STATEMENTS
31 DECEMBER 2014
5. FINANCIAL AND CAPITAL RISK MANAGEMENT (CONT’D):
(a) Financial risk factors (cont’d) -
(iii)
Credit risk
Credit risk is the risk that one party to a financial instrument will fail to
discharge an obligation and cause the other party to incur a financial loss. The
company has policies in place to ensure that transactions are made with
clients/organisations with an appropriate credit history. Cash transactions are
made with high credit quality financial institutions. The company manages its
credit risk by screening its clients, rigorous follow-up of
receivables/commitments and ensuring investments are low-risk or, are held
with reputable financial institutions.
(iv)
Liquidity risk
Liquidity risk is the risk that an enterprise will encounter difficulty in raising
funds to meet commitments associated with financial instruments. The
company manages this risk by keeping committed donors interested in the
activities of the company.
6. INCOME:
Revenue comprise the fair value of the consideration received in the ordinary course of the
company’s activities and is made up of cash and in-kind.
In-kind comprise goods received and jobs made available to youths participating in the
programme. Goods are valued at the invoiced value of the items received. Jobs are valued at
the rates at which payments are made to the participants.
7. TAXATION:
The company is an approved charitable organisation for purposes of Section 13(i)(g) of the
Income Tax Act, and its income is exempted from tax under Section 12(h) of the Income Tax
Act.