(a) Terms, conditions and accounting policies

Financial Instrument	Notes	Accounting Policies and Methods (including recognition criteria and measurement basis)	Nature of underlying instrument (including significant terms & conditions affecting the amount, timing and certainty of cash flows.
Financial Assets		Financial assets are recognised when control over future economic benefits is established and the amount of the benefit can be reliably measured.
Cash	6A 6B	Deposits are recognised at there nominal amounts. Interest is credited to revenue as it accrues.	Customs invests funds with a commercial bank at call. Monies in Customs bank accounts are swept into the Official Public Account nightly and interest is earned on the daily balance at rates based on money market call rate. Rates have averaged 7% for the year (1998-1999: 8%). Interest is paid at month end.
Receivables for goods and Services	6C	These receivables are recognised at the nominal amounts due less any provision for bad and doubtful debts. Collectability of debts is reviewed at balance date. Provisions are made when collection of the debt is judged to be less rather than more likely.	All receivables are with entities external to the Commonwealth. Credit terms are net 30 days (1998-1999: 30 days).
Receivables for customs duty and other	6D	These receivables are recognised at the nominal amounts due less any provision for bad and doubtful debts. Collectability of debts is reviewed at balance date. Provisions are made when collection of the debt is judged to be less rather than more likely.	The majority of receivables are with entities external to the Commonwealth. Credit terms vary.
Financial liabilities		Financial liabilities are recognised when a present obligation to another party is entered into and the amount of the liability can be reliably measured.
Other - refunds / rebates	9C	Approved claims for refunds and rebates are recognised at nominal amounts. The liability for unapproved claims is based on a percentage of approved claims during the year.	All liabilities are with entities external to the Commonwealth.
Finance lease liabilities	8A	Liabilities are recognised at the present value of the minimum lease payments at the beginning of the lease. The discount rates used are estimates of the interest rates implicit in the leases.	At reporting date, Customs had finance leases with terms averaging 5 years and a maximum term of 5 years. The interest rate implicit in the leases is 13.05% (1998-1999: 13.05%) The lease liabilities are secured by the lease assets.
Trade creditors	9B	Creditors and accruals are recognised at their nominal amounts, being the amounts at which the liabilities will be settled. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).	All creditors are entities that are not part of the Commonwealth legal entity. Settlement is usually made net 30 days.

Note 18 Financial Instruments (cont.)

(b) Interest Rate Risk: Agency

Financial Instrument	Notes	Floating interest rate		Fixed Interest Rate								Non- Interest Bearing		Total		Weighted Average Effective Interest rate
				1 year or less		1 to 2 years		2 to 5 years		> 5 years
		99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 %	98-99 %
Financial Assets
Cash at Bank	6A	-	-	62,448	-	-	-	-	-	-	-	146	623	62,594	623	7	8
Receivables	6C	-	-	-	-	-	-	-	-	-	-	22,603	41,013	22,603	41,013	n/a	n/a
Capital Use		-	-	-	-	-	-	-	-	-	-	795	-	795	-	n/a	n/a
													-
Total Financial Assets (Recognised)		-	-	62,448	-	-	-	-	-	-	-	23,544	41,636	85,992	41,636
Total Assets														216,028	142,896

Financial Liabilities
Trade Creditors and Accruals	9B	-	-	-	-	-	-	-	-	-	-	24,009	6,210	24,009	6,210	n/a	n/a
Finance Lease Liabilities	8A	-	-	20	15	-	20	-	-	-	-			20	35	13.05	13.05
Total Financial Liabilities (Recognised)		-	-	20	15		20	-		-	-	24,009	6,210	24,029	6,245
Total Liabilities														100,077	70,766

Note 18 Financial Instruments (cont.)

(b) Interest Rate Risk: Administered

Financial Instrument	Notes	Floating interest rate		Fixed Interest Rate								Non- Interest Bearing		Total		Weighted Average Effective Interest rate
				1 year or less		1 to 2 years		2 to 5 years		> 5 years
		99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000	99-00 $'000	98-99 $'000
Financial Assets
Cash at Bank	6B	-	-	-	-	-	-	-	-	-	-	465	2,297	465	2,297	n/a	n/a
Receivables	6D	-	-	-	-	-	-	-	-	-	-	79,454	55,553	79,454	55,553	n/a	n/a
Total Financial Assets  (Recognised)		-	-	-	-	-	-	-	-	-	-	79,919	57,850	79,919	57,850
Total Assets														79,932	58,069

Financial Liabilities
Subsides	n/a	-	-	-	-	-	-	-	-	-	-	-	-	-	-	n/a	n/a
Refunds / Rebates	9D	-	-	-	-	-	-	-	-	-	-	19,734	26,689	19,734	26,689	n/a	n/a
Total Financial Liabilities (Recognised)		-	-	-	-	-	-	-	-	-	-	19,734	26,689	19,734	26,689
Total Liabilities														19,734	26,689

Note 18 Financial Instruments (cont.)

(c) Net Fair Values of Financial Assets and Liabilities.

AGENCY		1999-00				1998-99
		Total Carrying Amount		Aggregate Net fair Value		Total Carrying Amount		Aggregate Net fair Value
	Note	$'000		$'000		$'000		$'000
Agency Financial Assets
Cash at bank	6A	62,594		62,594		352		352
Receivables for goods and services	6C	22,603		22,603		5,608		5,608
Capital use		795		795		-		-
Total Financial Assets		85,992		85,992		5,960		5,960
Financial Liabilities (recognised)
Trade creditors	9B	24,009		24,009		6,210		6,210
Finance lease	8A	20		20		35		35
Total Financial Liabilities (recognised)		24,029		24,029		6,245		6,245

Administered
Financial Assets
Cash at Bank	6B	465		465		1,891		1,891
Receivables for goods and services	6D	79,454		79,454		55,553		55,553
Total Financial Assets		79,919		79,919		57,444		57,444
Financial Liabilities (recognised)
Refunds / Rebates	9D	19,734		19,734		26,684		26,684
Total Financial Liabilities (recognised)		19,734		19,734		26,684		26,684

Note 18 Financial Instruments (cont.)

(c) Net Fair Values of Financial Assets and Liabilities (cont.)

Financial assets

The net fair values of cash and non-interest bearing monetary financial assets approximate their carrying amounts.

Financial liabilities

The net fair values for trade creditors and other liabilities are approximated by their carrying amounts.

The net fair values of finance leases are based upon discounted cash flows using the interest rate implicit in the lease.

(d) Credit Risk Exposures

Customs maximum exposure to credit risk at reporting date in relation to each class of recognised financial assets is the carrying amount of those assets as indicated in the Statement of Assets and Liabilities.

Customs has no significant exposures to any concentrations of credit risk.

Back to top | Previous | Next