CEF Annual report 2021

82 CEF FINANCIAL REPORT 2021
NOTES TO THE FINANCIAL STATEMENTS 83
NOTE 17: OTHER OPERATING EXPENSES
EUR
Other operating expenses 2021 2020
Contributions not related to labor costs 377 1,510
Students’ work 9,239 9,343
Other costs 526 2,366
Total 10,142 13,219
NOTE 18: Financial expenses record negative exchange rate changes.
NOTE 19: Other expenses represent differences from rounded amounts paid in cash.
4. Determination of fair value
and risk management
The CEF is exposed to the following risks: strategic, reputational, operational and financial.
The CEF’s prudent approach to risk management helps the CEF maintain its high level of operational
quality and is crucial for achieving its business goals. The use of standard methodologies
and risk management procedures enables quality risk assessment, timely responses, and minimum
exposure of the CEF to major risks, being strategic, reputational, operational and financial.
Strategic risks may arise from the pursuit of an unsuccessful business plan, poor business decisions,
substandard execution of decisions, inadequate resource allocation, and/or from a failure
to respond well to changes in the business environment. The CEF manages these risks by close
cooperation and under supervision by the Governing Board and other stakeholders.
Reputational risks may result in damages to the CEF’s reputation, which may manifest either in
lost revenues or increased costs and in destruction of stakeholders’ value and trust. To minimize
these risks, the CEF invests in building its ethics, security, sustainability, quality and innovation to
remain capable of answering to stakeholders’ needs.
Operational risks are imputed in CEF business activities through inadequate or failed internal
processes, people and systems, as well as from some external events. The CEF manages these
risks by strict implementation of internal procedures that include, but are not limited to, strict implementation
of the principle of four eyes, introduction of the internal audit function, and training
managers to improve their control functions.
Financial risks are associated with financing, including budgeting, managing expenses within
budgets, and overspending in case a project cannot be successfully completed without additional
expenses. The CEF manages these risks by budgeting for all expenses that might occur within the
project, and building sufficient reserves to cover potential loss from the project.
CREDIT RISK
EUR
Credit risk Note December 31, 2021 December 31, 2020
Cash and cash equivalents 4 2,242,706 2,282,149
Trade receivables 3 65,744 75,508
Total 2,308,449 2,357,657