Statement of profit or loss and other comprehensive income

for the period ended 30 June 2019

Statement of Financial Position

as at 30 June 2019

Statement of Changes in Equity

for the period ended 30 June 2019

Statement of cash flows

for the period ended 30 June 2019

Notes to and forming part of the Financial Statements

Overview

The National Housing Finance and Investment Corporation (NHFIC) was established in June 2018 under the National Housing Finance and Investment Corporation Act 2018 (Cth) (NHFIC Act). NHFIC is classified as a corporate Commonwealth entity and is an Australian Government owned for-profit entity.

The Australian Government established NHFIC in recognition that greater private and institutional investment is needed to expand the community housing sector and provide more Australians with access to affordable rental housing. NHFIC operates the Australian Housing Bond Aggregator (AHBA) to provide lower cost and longer-term finance for community housing providers by aggregating their borrowing requirements and issuing bonds into the wholesale market at a lower cost and longer-term than traditional bank finance. In addition, the Australian Government has loan funding of up to $1 billion as a warehouse facility for the operation of the AHBA. The benefits of accessing finance more efficiently will allow community housing providers to reinvest into expanding the supply of affordable housing. This will help to improve outcomes for social housing and homelessness.

NHFIC also administers the $1 billion National Housing Infrastructure Facility (NHIF). The NHIF will provide support to local governments through a range of options to finance critical infrastructure such as:

• transport links;
• power and water infrastructure; and
• site remediation works.

The NHIF will help local governments address infrastructure bottlenecks that impede development and build the infrastructure needed to speed up the supply of new housing. The NHIF will provide financial assistance though grants or equity/loan arrangements.

(a) Basis of preparation of the Financial Statements

The financial statements are general purpose financial statements and are required by section 42 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

The financial statements have been prepared in accordance with:

• Australian Accounting Standards (‘AAS’) and Interpretations—Reduced Disclosure Requirements (‘RDR’) issued by the Australian Accounting Standards Board (‘AASB’) that apply for the reporting period, with more extensive disclosures for Financial Instruments; and
• Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR).

These financial statements have been prepared on an accrual basis and under the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. The financial statements are prepared in Australian dollars and rounded to the nearest thousand dollar ($’000).

As NHFIC was established on 29 June 2018, a reporting exemption was granted for the prior year. The financial statements prepared are for the period of NHFIC’s operation from 29 June 2018 to 30 June 2019.

(b) New Australian Accounting Standards (AAS)

Consistent with government policy, no accounting standard has been adopted earlier than the application date as stated in the standard.

The adoption of new standards and amendments that came into effect for this financial period did not have a significant financial impact on the financial statements.

AASB 9—Financial Instruments

AASB 9 has been applied from 1st July 2018.

AASB 9 contains three principal classification categories for financial assets: measured at amortised cost, Fair Value Through Other Comprehensive Income (FVOCI) and Fair Value Through Profit or Loss (FVTPL). The classification of financial assets under AASB 9 is generally based on the business model in which a financial asset is managed and its contractual cash flow characteristics. AASB 9 replaces the previous AASB 139 categories of held to maturity, loans and receivables and available for sale.

The reason for holding investments is to collect the contractual cash flows which are ‘solely payments of principal and interest on the principal amount outstanding’. NHFIC’s business model is to hold these financial assets until maturity. In limited cases Investments may be liquidated for cash requirement purposes.

AASB 9 requires all investments and loans measured at amortised cost to be evaluated for impairment at transition date and also requires an ongoing evaluation using an expected credit loss model.

On evaluation, all investment securities have a term to maturity of less than twelve months and are held with Australian ADIs rated AA- or higher. Therefore, it has been determined that no impairment should be recognised on day one or in the subsequent twelve months.

Loans and advances are measured at amortised cost and these loans were evaluated at 30 June 2019 using an expected credit loss model.

AASB 15—Revenue from contracts with customer

AASB 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It replaces existing revenue recognition guidance, including AASB 118 Revenue.

There is no significant effect to the accounting results on the implementation of this standard.

A number of new and revised Australian accounting standards apply to NHFIC’s financial statements in later years. The assessment of the main effects of these standards on its financial statements is set out below.

AASB 16—Leases

Effective 1 July 2019, AASB 16 requires the majority of operating leases to be brought onto the balance sheet. As NHFIC does not hold any significant leases at present there will be no material impact.

(c) Taxation

Under section 52 of the NHFIC Act, NHFIC is exempt from all forms of taxation except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST)

• where the amount of GST incurred is not recoverable as an input tax credit from the Australian Taxation Office, it is recognised as part of the cost of acquisition of an asset or as part of an item of expense; and
• the net amount of GST recoverable from, or payable to, the Australian Taxation Office is included as part of the receivables, payables or commitments.

(d) Property, plant and equipment

Asset recognition threshold

Purchases of property, plant and equipment are recognised initially at cost in the Statement of Financial Position, except for:

• items of property with a project cost less than $15,000 (which are expensed in the year of acquisition): and
• items of plant and equipment costing less than $5,000 (which are expensed in the year of acquisition).

Revaluations and fair value measurement

All leasehold improvements, plant and equipment are measured at fair value.

Following initial recognition at cost, leasehold improvements and plant and equipment are carried at fair value less accumulated depreciation and any accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not materially differ from the assets’ fair values at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.

Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reversed a previous revaluation decrement of the same asset class that was previously recognised in the surplus/deficit.

Revaluation decrements for a class of assets are recognised directly in the surplus/deficit except to the extent that they reversed a previous revaluation increment for that class. Any accumulated depreciation is eliminated against the gross carrying amount of the asset and the asset restated to the revalued amount.

NHFIC has a policy of having non-financial assets revalued every five years unless there are significant changes in economic indicators.

Depreciation

Depreciable property, plant and equipment are written-off to their estimated residual values over their estimated useful lives to NHFIC, using in all cases, the straight-line method of depreciation. Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate.

Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

Derecognition

An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

Impairment of non-financial assets

All assets were assessed for impairment at 30 June 2019. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.

The recoverable amount of an asset is the higher of its fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the Department were deprived of the asset, its value in use is taken to be its current replacement cost.

(e) Contingencies and commitments—assets and liabilities

Where, as a result of past events, there is a possible asset or liability whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of NHFIC this will be disclosed as a contingent asset or contingent liability. When the inflow of economic benefits is probable, but not virtually certain, NHFIC will recognise the contingent asset. When the outflow of economic benefits is probable, NHFIC will recognise the contingent liability.

Commitments to provide financial facilities are contractually based. For loans and advances NHFIC has committed to lend a fixed amount and any undrawn amounts under these facilities are shown as commitments.

(f) Events after the reporting period

There have been no material events occurring after the reporting period that impact these financial statements for the period ended 30 June 2019.

Note 1: Our Financial Performance

Note 1.1: Revenue

Accounting Policy

Revenue is recognised and measured at the fair value of the consideration received or receivable to the extent it is probable that the economic benefits will flow to NHFIC and the revenue can be reliable measured.

For transactions at amortised cost, the income or expenses are taken through the profit or loss using the effective interest method. Establishment fees relating to the successful origination or settlement of a loan are deferred and recognised as an adjustment to the effective interest rate on the loan.

Accounting Policy

Revenue from Government

Amounts provided by the Australian Government for NHFIC operating funds and NHIF grants are recognised as Revenue from Government in the Statement of profit or loss and other comprehensive income when NHFIC gains control of the contribution.

Note 1.2: Expenses

Accounting Policy

Employee Benefits

Accounting policies for employee related expenses is contained in the Our People section (refer to Note 4).

Accounting Policy

Concessional Loan Discount

A concessional loan discount provision is recorded when NHFIC makes a loan at a discount to the prevailing market equivalent rates or terms. The concessional loan discount provisions is a non-cash concession and will unwind over the term of the underlying loan and will be disclosed as concessional loan income. As the concessional loan discount is a non-cash adjustment, it does not impact the underlying operational earning of NHFIC. Over the life of the loans, the impact of the reported profit or loss of NHFIC from the discount and income will net to $nil.

The Investment Mandate which guides NHFIC’s operations requires it to make loans to the Community Housing Provider Sector (CHPS) at the lowest possible interest rates, after making allowance for a margin that will cover NHFIC’s operating costs. The total financial impact of the differences between market interest rates and those charged by NHFIC, which amount to $61.15m are recorded as “Concessional loan discount provisions” and represents management’s best estimate of the interest savings that will flow through to the CHPS over the life of the current NHFIC loan portfolio.

Reference to the Statement of Cash Flows demonstrates that NHFIC should always have capacity to service AHBA interest commitments, as the Concessional loan provisions have no impact on cash flows. Furthermore, NHFIC’s Statement of Financial Position discloses Net Assets of $154 million and a high level of liquidity.

Accounting Judgement and Estimates

NHFIC is required to record a concessional loan discount provision when it makes a loan at a discount to the prevailing market equivalent rate or terms. This requires extensive judgement in determining the ‘market equivalent rate’ so as to ascertain the extent of the implicit discount attached to the loan. To estimate the market rate, NHFIC considers key loan terms including, the term (loan tenor and drawdown and repayment profile), base rate and type (fixed or floating), level of subordination, security position and other relevant factors so the extent of concessionality being offered in the transactions can be estimated.

NHFIC’s aim is to provide AHBA loans to registered CHPs at the lowest cost and most appropriate tenor. To achieve this aim the discounts provided to the market rates can result in significant concessional loan discounts. The average tenor of the loan portfolio is 10 years, when discounting the difference between the future cashflows at the loan rate and the market equivalent rate, this results in significant concessional loan charges. As the AHBA loan portfolio increases, the concessional loan charges will also increase in line with the portfolio, depending on amount of discount provided for each loan.

Note 2: Financial Position

Note 2.1: Financial assets

Accounting Policy

Cash and cash equivalents

Cash is recognised at its nominal amount as this is considered fair value. Cash and cash equivalents includes cash at bank and in hand and deposits at call which are readily convertible to cash on hand.

Accounting Policy for Financial Assets

Trade Receivable and other Receivables

Trade receivables and other receivables are held for the purpose of collecting the contractual cash flows where the cash flows are solely payments of principal and interest are subsequently measured at amortised cost using the effective interest method adjusted for any loss allowance.

Loans and Advances

Loans are carried at amortised cost. The recoverable amount is represented by the gross value of the outstanding balances, adjusted by allowances for credit risk, deferred net fee income, and concessional loan discounts. Deferred net fee income received in cash at the start of the loan are brought to income on an effective yield basis over the life of the loan by reducing the carrying amount. Interest income is recognised using the effective interest method. A loan or receivable is recognised as impaired when it is likely that the debt will not be recovered in full. In this instance a specific provision will be created for the impairment.

Investment securities at amortised cost

The reason for holding investments is to collect the contractual cash flows which are ‘solely payments of principal and interest on the principal amount outstanding’. NHFIC’s business model is to hold these financial assets until maturity. They are short to medium-term term deposits. Interest income is taken up using the effective interest method. They are carried at amortised cost.

Impairment

All investment securities have a deal term to maturity of less than twelve months and are held with Australian ADIs rated AA- or higher. Therefore, it has been determined that no impairment should be recognised on day one or in the subsequent twelve months.

For loans measured at amortised cost under AASB 9, the incurred loss model for impairment has been replaced with an expected credit loss model. These loans were evaluated at 30 June 2019 using an expected credit loss model.

Note 2.2: Payables

Accounting Policy

Supplier and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).

Note 2.3: Provisions

Accounting Policy

Provisions

Provisions are recognised when NHFIC has a present obligation (legal or constructive) as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the reporting date. Where the effect of the time value of money is material, the obligation is measured using a discount rate which reflects current market assessments and the risks specific to the liability. Increases in the provision due to the passage of time (unwinding of the discount) are then recognised as expense.

Provision for irrevocable loan commitments

NHFIC calculates a expected credit loss allowance and concessional discount expense for the undrawn component of loans that are not yet fully drawn and where future drawdowns are unconditional.

Note 3: Our Funds Management

Note 3.1: Contributions from Government

The Australian Government has provided operating funding for the first three years to assist with the establishment of the NHFIC. In addition, the Australian Government has provided $1.0 billion over five years (2018–19 to 2022–23) for the operation of the National Housing Infrastructure Facility (NHIF), which consist of funding for grants and equity/loan arrangements. This funding is appropriated to the Department of the Treasury.

In addition, the Department of the Treasury maintains the NHFIC Special Account established in accordance with section 47A of the NHFIC Act. The purpose of the special account is to provide NHFIC with loan funding of up to $1 billion as a warehouse facility for the operation of the Affordable Housing Bond Aggregator. The $1 billion may be credited to the NHFIC special account over four years in accordance with section 47B of the NHFIC Act.

Accounting Policy

Revenue from Government

Amounts provided by the Australian Government for the NHFIC operating funds and NHIF grants are recognised as Revenue from Government in the Statement of Comprehensive Income when NHFIC gains control of the contribution.

Equity Injections

Amounts provided by the Australian Government for NHIF equity and loan arrangements are recognised as an equity injection in the Statement of Financial Position.

Drawing from the NHFIC Special Account

Amounts received from the Australian Government as drawings from the NHFIC Special Account will be recognised as a Loan from the Australian Government. Repayments of loan will be credited to the NHFIC Special Account.

Note 3.2: Interest bearing liabilities

On 22 March 2019, NHFIC launched the largest social bond in Australia for the total value of $315 million. The bond issue was a 10 year fixed rate bond at an annual interest rate of 2.38%.

Accounting Policy

The Loan from the Commonwealth Government represents amounts received as drawings from the NHFIC Special Account and is measured at measured at amortised cost.

Fixed rate bonds are initially measured at fair value, net of transaction costs. These liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective interest basis.

Note 4: People and Relationships

Note 4.1A: Employee benefits

Accounting Policy

Employee Benefits

Liabilities for ‘short-term employee benefits’ (as defined in AASB 119 Employee Benefits) and termination benefits due within twelve months of the end of the reporting period are measured at their nominal amounts.

Other long-term employee benefits are measured as net total of the present value of the defined benefit obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.

Leave

The liability for employee benefits includes provision for annual leave and long service leave. The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will be applied at the time the leave is taken, including the applicable employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination. Long service leave is measured at the present value of expected future payments to be made in respect of services provided by employees up to the reporting date and discounted using appropriate market yields at reporting date. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

Superannuation

NHFIC makes contributions on behalf of its members of the Public Sector Superannuation Scheme (PSS) and its obligation is limited to a required annual contributions determined by the actuaries of the superannuation plans administered by the Commonwealth. Accordingly, the plans are accounted for by NHFIC as defined contribution plans. The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course.

NHFIC staff can also be members of superannuation funds held outside the Australian Government. NHFIC makes employer contributions to these funds as per the Superannuation Guarantee Contribution rate.

The liability for superannuation recognised as at 30 June represents outstanding contributions for the final fortnight of the year.

Note 4.2: Related party disclosures

Total remuneration received and receivable by key management personnel for the period (includes Directors). Remuneration includes all cash remuneration, superannuation and any non-cash benefits (including applicable fringe benefits tax).

Total number of key management personnel that are included in the above table are: eight (8)

The above key management personnel remuneration excludes the remuneration and other benefits of the Portfolio Minister. The Portfolio Minister’s remuneration and other benefits are set by the Remuneration Tribunal and are not paid by NHFIC.

The Board and CEO remuneration and other benefits are set by the Remuneration Tribunal. The Board members and CEO are not paid performance awards.

Note 4.3: Related party relationships

The entity is an Australian Government controlled entity. Related parties to the entity are the key management personnel as defined above and other Australian Government entities.

Given the breadth of Government activities, related parties may transact with the government sector in the same capacity as ordinary citizens.

Significant transactions with related parties can include provision of corporate and administration services to NHFIC, the provision of insurance, the provision of leases and the purchases of goods and services.

Giving consideration to relationships with related entities, and transactions entered into during the reporting period by the entity, it has been determined that there are no material related party transactions to be separately disclosed.

Note 5: Managing Uncertainties

Accounting Policy

Loan commitments are defined amounts (undrawn portions of credit facilities) against which clients can borrow money under defined terms and conditions.

Note 5.1: Financial instruments

Accounting Policy

Financial assets

With the implementation of AASB 9 Financial Instruments in 2019, NHFIC classifies its financial assets in the following categories:

a. financial assets at fair value through profit or loss;
b. financial assets at fair value through other comprehensive income; and
c. financial assets measured at amortised cost.

The classification depends on both NHFIC’s business model for managing the financial assets and contractual cash flow characteristics at the time of initial recognition. Financial assets are recognised when NHFIC becomes a party to the contract and, as a consequence, has a legal right to receive or a legal obligation to pay cash and derecognised when the contractual rights to the cash flows from the financial asset expire or are transferred upon trade date.

Financial Assets at Amortised Cost

Financial assets included in this category need to meet two criteria:

1. the financial asset is held in order to collect the contractual cash flows; and
2. the cash flows are solely payments of principal and interest (SPPI) on the principal outstanding amount. Amortised cost is determined using the effective interest method.

Effective Interest Method

Income is recognised on an effective interest rate basis for financial assets that are recognised at amortised cost.

Financial Assets at Fair Value Through Other Comprehensive Income (FVOCI)

Financial assets measured at fair value through other comprehensive income are held with the objective of both collecting contractual cash flows and selling the financial assets and the cash flows meet the SPPI test. Any gains or losses as a result of fair value measurement or the recognition of an impairment loss allowance is recognised in other comprehensive income.

Financial Assets at Fair Value Through Profit or Loss (FVTPL)

Financial assets are classified as financial assets at fair value through profit or loss where the financial assets either doesn’t meet the criteria of financial assets held at amortised cost or at FVOCI (i.e. mandatorily held at FVTPL) or may be designated.

Financial assets at FVTPL are stated at fair value, with any resultant gain or loss recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest earned on the financial asset.

Impairment of Financial Assets

Financial assets are assessed for impairment at the end of each reporting period based on Expected Credit Losses, using the general approach which measures the loss allowance based on an amount equal to lifetime expected credit losses where risk has significantly increased, or an amount equal to 12-month expected credit losses if risk has not increased significantly.

The simplified approach for trade, contract and lease receivables is used. This approach always measures the loss allowance as the amount equal to the lifetime expected credit losses.

A write-off constitutes a derecognition event where the write-off directly reduces the gross carrying amount of the financial asset.

Financial liabilities

Financial liabilities are classified as either financial liabilities ‘at fair value through profit or loss’ or other financial liabilities. Financial liabilities are recognised and derecognised upon ‘trade date’.

Financial Liabilities at Fair Value Through Profit or Loss

Financial liabilities at fair value through profit or loss are initially measured at fair value. Subsequent fair value adjustments are recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability.

Financial Liabilities at Amortised Cost

Financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. These liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective interest basis.

Note 5.1D: Credit Risk

Credit risk arises from the possibility of defaults by counterparties on contractual obligations, resulting in financial loss. Exposures to credit risk for NHFIC are as follows:

NHFIC’s principal exposure to credit risk arises from the financing and credit facilities extended to customers.

NHFIC evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained is based on Management’s credit evaluation of the counterparty. Collateral held will vary, but may include:

• a General Security Deed over all assets and undertakings of the counterparty;
• First Registered Mortgages over the collateral property securities; and
• specific charges over defined assets of the counterparty; and
• Ancillary Deeds where applicable; and
• Facility and Common Terms Agreements which include affirmative and negative covenants and in some instances, guarantees of counterparty obligations

NHFIC uses seven broad categories of risk grade, with category 1 representing the lowest risk. Within categories 1 to 6 an outlook modifier of plus or minus is used if the counterparty is particularly strong or weak for that risk grade. The equivalent risk, based on Standards and Poor’s risk rating, is stated in brackets. The gross exposures of the loan portfolio under each category are as follows:

As at 30 June 2019, NHFIC holds collateral of $1.1 Billion.

Credit risk arising from NHFIC through its investment portfolios is limited to Authorised Deposit-taking Institutions rated AA- or above.

The tables below show Investment credit risk exposures by the current counterparty rating:

Note 5.1E: Liquidity Risk

Prudent liquidity risk management is achieved by maintaining sufficient cash and liquid deposits to meet any sudden shortfalls in the ability to fund NHFIC. NHFIC also has the explicit guarantee of the Commonwealth of Australia, which is rated AAA and therefore in normal markets there is no significant liquidity risk.

The liquidity table below is based on estimated future cash flows for principal and interest. The contractual undiscounted amounts comprise principal and interest repayment obligations and are as follows:

	Contractual undiscounted principal and interest
	3 months or less	3 months to 1 year	1 year to 5 years	Greater than 5 years
	2019	2019	2019	2019
	$'000	$'000	$'000	$'000
Undiscounted financial assets
Cash and cash equivalents	39,347	-	-	-
Trade and other receivables	1,202	-	-	-
Loans and advances	2,259	6,728	35,873	351,804
Investments - deposits	203,437	-	-	-
Total undiscounted financial assets	246,246	6,728	35,873	351,804
Undiscounted financial liabilities
Other interest bearing liabilities	3,748	3,973	45,758	352,485
Total undiscounted financial liabilities	3,748	3,973	45,758	352,485
Net undiscounted financial assets/(liabilities)	242,497	2,755	(9,885)	(681)

While the above maturity profile shows a refinancing shortfall in the categories 1 year to 5 years, and greater than 5 years, this is predominately due to the expectation that loans currently funded via loans from Government will be replaced with borrowings from future bond issuances. Further, at the reporting date, two CHP loans totalling $22 million funded by the first bond issuance were yet to draw, and proceeds remained on deposit resulting in the shortfall in the greater than 5 years category.

Note 5.1F: Interest Rate Risk

As NHFIC is involved in lending and borrowing activities, interest rate risks arise. NHFIC’s policy is to minimise interest rate risk and central to its business model, loans are issued at fixed rates and tenors which are matched to a fixed rate borrowings either from bond issuances or loans from Government. Whilst the exposure to interest rate risk is eliminated on the loans portfolio, interest receivable from cash and other financial assets will be impacted prospectively from a change interest rates.

NHFIC’s primary exposure to interest rate risks of interest bearing financial assets and financial liabilities is set out below:

	2019
Interest Bearing Financial Assets	$'000
Classified as floating rate
Cash and cash equivalents	39,347
Total classified as floating rate	39,347
Classified as fixed rate
Investments - deposits	201,458
Loans and advances	308,323
Total classified as fixed rate	509,781
Interest Bearing Financial Liabilities
Classified as fixed rate
Other interest bearing liabilities	329,878
Total classified as fixed rate	329,878

The cash and cash equivalents and other financial assets are expected to be invested in Investments—deposits in the short term, and the majority of these financial assets are expected to be classified as fixed rate. A +/-20bp change in the interest rate on floating rate financial assets would have approximately a +/- $0.4 million impact on the reported revenue and surplus.

Note 6: Other information

Note 6.1: Reporting of NHFIC activities

Note 6.2: Aggregate assets and liabilities