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126
Vodafone Group Plc
Annual Report 2012
Notes to the consolidated nancial statements (continued)
21. Capital and nancial risk management (continued)
The following table presents ageing of receivables that are past due and provisions for doubtful receivables that have been established.
2012 2011
Gross
receivables
Less
provisions
Net
receivables
Gross
receivables
Less
provisions
Net
receivables
£m £m £m £m £m £m
30 days or less 1,914 (390) 1,524 1,933 (372) 1,561
Between 31 – 60 days 192 (21) 171 140 (40) 100
Between 61 – 180 days 435 (96) 339 157 (72) 85
Greater than 180 days 598 (433) 165 778 (480) 298
3,139 (940) 2,199 3,008 (964) 2,044
Concentrations of credit risk with respect to trade receivables are limited given that the Group’s customer base is large and unrelated. Due to this
management believes there is no further credit risk provision required in excess of the normal provision for bad and doubtful receivables. Amounts
charged to administrative expenses duringthe year ended 31 March 2012 were £458million (2011: £460million, 2010: £465million) (see note 17).
The Group’s investments in preferred equity and a subordinated loan received as part of the disposal of Vodafone Japan to SoftBank in the 2007
nancial year were disposed of in the prior year. The Group has a receivable of £1,514million (2011: £1,488 million) in relation to the second tranche
of consideration receivable in relation to the disposal. This amount was received on 2 April 2012.
As discussed in note 29 the Group has covenanted to provide security in favour of the Trustee of the Vodafone Group UK Pension Scheme in respect
of the funding decit in the scheme. The security takes the form of an English law pledge over UK index linked government bonds.
Liquidity risk
At 31 March 2012 the Group had €4.2 billion and US$4.2 billion syndicated committed undrawn bank facilities and US$15 billion and £5 billion
commercial paper programmes, supported by the €4.2 billion and US$4.2 billion syndicated committed bank facilities, available to manage its
liquidity. The Group uses commercial paper and bank facilities to manage short-term liquidity and manages long-term liquidity by raising funds in
the capital markets.
€4.2 billion of the syndicated committed facility has a maturity date of 1 July 2015. US$4.2 billion has a maturity of 9 March 2016; during the year
US$4.1 billion of this facility was extended by one year, now maturing 9 March 2017. Both facilities have remained undrawn throughout the nancial
year and since year end and provide liquidity support.
The Group manages liquidity risk on long-term borrowings by maintaining a varied maturity prole with a cap on the level of debt maturing in any
one calendar year, therefore minimising renancing risk. Long-term borrowings mature between one and 25 years.
Liquidity is reviewed daily on at least a 12 month rolling basis and stress tested on the assumption that all commercial paper outstanding matures
and is not reissued. The Group maintains substantial cash and cash equivalents which at 31 March 2012 amounted to £7,138million
(2011:£6,252million).
Market risk
Interest rate management
Under the Group’s interest rate management policy, interest rates on monetary assets and liabilities denominated in euros, US dollars and sterling
are maintained ona oating rate basis except for periods up to six years where interest ratexing has to be undertaken in accordance with treasury
policy. Where assets and liabilities are denominated in other currencies interest rates may also be xed.Inaddition, xing is undertaken for longer
periods when interest rates are statistically low.
For each one hundred basis point fall or rise in market interest rates for all currencies in which the Group had borrowings at 31 March 2012 there
would be a reduction or increase in prot before tax by approximately £33million (2011: increase or reduce by £30million) including mark-to-
market revaluations of interest rate and other derivatives and the potential interest on outstanding tax issues. There would be no material impact
onequity.