Note 5.2: Financial Instruments
2019 |
2018 |
|
---|---|---|
$'000 |
$'000 |
|
Note 5.2A - Categories of Financial Instruments |
||
Financial assets |
||
Loans and receivables |
||
Cash and cash equivalents |
18,653 |
14,393 |
Receivables for goods and services |
1,184 |
1,495 |
Interest receivable |
115 |
345 |
Fixed term deposit with a bank |
41,580 |
38,967 |
Accrued revenue |
100 |
611 |
Total loans and receivables |
61,632 |
55,811 |
Total financial assets |
61,632 |
55,811 |
Financial liabilities |
||
Financial liabilities measured at amortised cost |
||
Supplier payables |
1,978 |
3,203 |
Grant payables |
- |
60 |
Total financial liabilities measured at amortised cost |
1,978 |
3,263 |
Total financial liabilities |
1,978 |
3,263 |
Classification of financial assets on the date of initial application of AASB 9
AASB 139 original classification |
AASB 9 new classification |
AASB 139 carrying amount at 1 July 2018 |
AASB 9 carrying amount at 1 July 2018 |
||
---|---|---|---|---|---|
Financial assets class |
Note |
$'000 |
$'000 |
||
Cash and cash equivalents |
2.1A |
Loans and receivables |
Amortised Cost |
14,393 |
14,393 |
Receivables for goods for services |
2.1B |
Loans and receivables |
Amortised Cost |
1,495 |
1,495 |
Interest receivable |
2.1B |
Loans and receivables |
Amortised Cost |
345 |
345 |
Fixed term deposit with a bank |
2.1C |
Loans and receivables |
Amortised Cost |
38,967 |
38,967 |
Accrued revenue |
Loans and receivables |
Amortised Cost |
611 |
611 |
|
Total financial assets |
55,811 |
55,811 |
Reconciliation of carrying amounts of financial assets on the date of initial application of AASB 9
AASB 139 carrying amount at 30 June 2018 |
Reclassification |
Remeasurement |
AASB 9 carrying amount at 1 July 2018 |
|
---|---|---|---|---|
$'000 |
$'000 |
$'000 |
$'000 |
|
Financial asset at amortised cost |
||||
Loans and receivables |
||||
Cash and cash equivalents |
14,393 |
- |
- |
14,393 |
Receivables for goods and services |
1,495 |
- |
- |
1,495 |
Interest receivable |
345 |
- |
- |
345 |
Fixed term deposit with a bank |
38,967 |
- |
- |
38,967 |
Accrued revenue |
611 |
- |
- |
611 |
Total amortised cost |
55,811 |
55,811 |
There was no change in the carrying amount of financial assets based on the measurement under AASB 139 to AASB 9.
Accounting policy
Financial assets
With the implementation of AASB 9 Financial Instruments for the first time in 2019, the NLA classifies its financial assets as financial assets measured at amortised cost.
This classification was determined through examination of both the NLA's business model for managing the financial assets and contractual cash flow characteristics at the time of initial recognition. Financial assets are recognised when the NLA 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.
Comparatives have not been restated on initial application.
Financial assets at amortised cost
Financial assets included in this category need to meet two criteria:
- the financial asset is held in order to collect the contractual cash flows; and
- 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.
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.
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 writeoff 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.
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).
2019 |
2018 |
|
---|---|---|
$'000 |
$'000 |
|
Note 5.2B - Net Gains and Losses from financial assets |
||
Loans and receivables |
||
Interest revenue |
1,460 |
1,312 |
Net gain loans and receivables |
1,460 |
1,312 |
Net gain on financial assets |
1,460 |
1,312 |
Visit
https://www.transparency.gov.au/annual-reports/national-library-australia/reporting-year/2018-2019-51