Annual Report 2010 in PDF - BBA Aviation

Financial statements Notes to the Consolidated Financial Statements – continued
85 Independent Auditor’s
Report to the Members of
BBA Aviation plc in Respect
of the Consolidated
12. Other fnancial assets – continued
Trade receivables
Financial Statements
An allowance has been made for estimated irrecoverable amounts from the sale of goods and services of £4.2 million (2009: £3.1 million).
86
87
Consolidated Income
Statement
Consolidated Statement of
Comprehensive Income
This allowance has been determined by reference to past default experience and current expectations.
Included in the Group’s trade receivables balances are debtors with a carrying amount of £27.0 million (2009: £36.4 million) which are past
due at the reporting date for which the Group has not provided as there has not been a signifcant change in credit quality and the amounts are
88 Consolidated Balance Sheet still considered recoverable. The Group does not hold any collateral over these balances. The average age of these overdue receivables is 58 days
(2009: 61 days).
89 Consolidated Cash Flow
Statement
2010 2009
90 Consolidated Statement of £m £m
Changes in Equity
Ageing of past due but not impaired receivables
– 60 days 20.2 24.8
– 90 days 3.7 7.1
– 120 days 1.5 1.0
Report to the Members of
BBA Aviation plc in Respect
of the Parent Company
Financial Statements
120 days 1.6
27.0
3.5
36.4
91 Accounting Policies of
the Group 30
95 Notes to the Consolidated 60
Financial Statements 90
126 Independent Auditor’s over
127 Company Balance sheet
128 Accounting Policies of
the Company Movement in the allowance for doubtful debts
129 Notes to the Company Beginning of
Financial Statements Exchange
134 Principal Subsidiary
Undertakings
Disposals of
135 Five Year Summary
136 Shareholder Information
104 — Consolidated Financial Statements
2010 2009
£m £m
year (3.1) (5.1)
adjustments (0.1) 0.5
businesses – 0.2
Amounts written off as uncollectable 1.6 1.3
Charged in the year (2.6) –
End of year (4.2) (3.1)
In determining the recoverability of a trade receivable the Group considers any change in the credit quality of the trade receivable from the date
credit was initially granted up to the reporting date. The concentration of credit risk is limited due to the customer base being large and
unrelated. Accordingly, the directors believe that there is no further credit provision required in excess of the allowance for doubtful debts. The
directors consider that the carrying amount of trade and other receivables approximates their fair value.
2010 2009
£m £m
Ageing of impaired trade receivables
90 – 120 days – 0.6
Over 120 days 3.1 0.2
3.1 0.8
Cash and cash equivalents
Cash and cash equivalents comprise cash held by the Group and short-term bank deposits with an original maturity of three months or less.
The carrying amount of these assets approximates their fair value.
Credit risk
The Group’s principal fnancial assets are bank balances and cash, trade and other receivables, fnance lease receivables and investments.
The credit risk on liquid funds and derivative fnancial instruments is limited because the counterparties are banks with high credit-ratings
assigned by international credit-rating agencies.
The Group’s credit risk is primarily attributable to its trade and fnance lease receivables. The amounts presented in the balance sheet are net of
allowances for doubtful receivables. An allowance for impairment is made where there is an identifed loss event which, based on previous
experience, is evidence of a reduction of the cash fows.
The Group has no signifcant concentration of credit risk, with exposure spread over a large number of counterparties and customers.