Fair value interest rate risk is the risk that the fair value of the financial instrument will fluctuate because of changes in market interest rates. The VCAA does not hold any financial instruments that are measured at fair value, therefore has no exposure to fair value interest rate risk. Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The VCAA actively manages this risk by monitoring movement in interest rates on a daily basis. Management has concluded for cash at bank, as a financial asset can be left at floating rate without necessarily exposing the VCAA to significant bad risk. The carrying amount of financial assets and financial liabilities that are exposed to interest rates are set out below. In addition, the VCAA’s sensitivity to interest rate risk is set out in the table that follows. Interest rate exposure of financial instruments Interest rate risk exposure Weighted average Carrying Fixed interest Variable interest Non-interest effective amount rate rate bearing interest rate $ $ $ $ % 2017 Financial assets Cash and deposits 1.08 11,161,896 11,161,896 – – Receivables1 2,083,597 2,083,597 – – Total financial assets 13,245,493 11,161,896 2,083,597 – Financial liabilities Payables1 Supplies and services 6,788,884 6,788,884 – – Borrowings Lease liabilities 150,952 150,952 – – Total financial 6,939,836 150,952 6,788,884 – liabilities 2016 Financial assets Cash and deposits 1.46 10,941,508 10,941,508 – – Receivables1 1,676,442 1,676,442 – – Total financial assets 12,617,950 10,941,508 1,676,442 – Financial liabilities Payables1 Supplies and services 6,269,406 6,269,406 – – Borrowings Lease liabilities 89,423 89,423 – – financial 6,358,829 89,423 6,269,406 – liabilities
Fair value interest rate risk is the risk that the fair value of the financial instrument will fluctuate because of changes in market interest rates. The VCAA does not hold any financial instruments that are measured at fair value, therefore has no exposure to fair value interest rate risk. Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The VCAA actively manages this risk by monitoring movement in interest rates on a daily basis. Management has concluded for cash at bank, as a financial asset can be left at floating rate without necessarily exposing the VCAA to significant bad risk. The carrying amount of financial assets and financial liabilities that are exposed to interest rates are set out below. In addition, the VCAA’s sensitivity to interest rate risk is set out in the table that follows. Interest rate exposure of financial instruments Interest rate risk exposure Weighted average effective interest rate % Carrying amount $ Fixed interest rate $ Variable interest rate $ Non-interest bearing $ 2017 Financial assets Cash and deposits 1.08 11,161,896 – 11,161,896 – Receivables1 2,083,597 – – 2,083,597 Total financial assets 13,245,493 – 11,161,896 2,083,597 Financial liabilities Payables1 Supplies and services 6,788,884 – – 6,788,884 Borrowings Lease liabilities 150,952 150,952 – – Total financial liabilities 6,939,836 150,952 – 6,788,884 2016 Financial assets Cash and deposits 1.46 10,941,508 – 10,941,508 – Receivables1 1,676,442 – – 1,676,442 Total financial assets 12,617,950 – 10,941,508 1,676,442 Financial liabilities Payables1 Supplies and services 6,269,406 – – 6,269,406 Borrowings Lease liabilities 89,423 89,423 – – financial liabilities 6,358,829 89,423 – 6,269,406
AnnualReport2016-2017wordwebversion.docx