Creative 2014 Annual Report Download - page 56

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56
CREATIVE TECHNOLOGY LTD AND ITS SUBSIDIARIES
NOTES TO THE FINANCIAL STATEMENTS
For the nancial year ended 30 June 2014
29. FINANCIAL RISK MANAGEMENT (cont’d)
(b) Credit risk (cont’d)
Group
2014 2013
US$’000 US$’000
Past due 1 to 60 days 1,086 1,724
Past due 61 to 120 days 333 106
Past due over 120 days 747 894
2,166 2,724
The carrying amount of trade receivables individually determined to be impaired and the movements in the related allowance
for impairment are as follows:
Group
2014 2013
US$’000 US$’000
Past due 1 to 60 days 5 178
Past due 61 to 120 days 10 1
Past due over 120 days 3,471 4,212
3,486 4,391
Less: Allowance for impairment (3,486) (4,391)
– –
Beginning of nancial year 4,391 4,914
Currency translaon dierences – 6
Allowance write-back (28) (220)
Allowance ulised (877) (309)
End of nancial year 3,486 4,391
The impaired trade receivables arose mainly from sales to customers who signicantly delayed their payments.
(c) Liquidity risk
To manage liquidity risk, the Group monitors its net operating cash ows and maintains an adequate level of cash and cash
equivalents and secured committed funding facilities from nancial institutions. In assessing the adequacy of these funding
facilities, management reviews its working capital requirements regularly.
As at 30 June 2014 and 30 June 2013, the Group’s nancial liabilities mature in less than 1 year’s time.
(d) Capital risk
The Group’s objectives when managing capital, which the Group denes as total equity, are to safeguard the Group’s ability
to continue as a going concern and to maintain an optimal capital structure so as to maximise shareholder value. In order
to maintain or achieve an optimal capital structure, the Group may adjust the amount of dividend payment, return capital to
shareholders, issue new shares, buy back issued shares or obtain new borrowings.
As at 30 June 2014, there were no signicant concentrations of credit risk and no customer (2013: 1) individually accounted
for 10% or more of net accounts receivable.
Bank deposits that are neither past due nor impaired are mainly deposits with banks with high credit-ratings assigned by
international credit-rating agencies. Trade receivables that are neither past due nor impaired are substantially companies
with a good collection track record with the Group.
There is no other class of nancial assets that is past due and/or impaired except for trade receivables.
The age analysis of trade receivables past due but not impaired is as follows: