Vtech 2011 Annual Report Download - page 51

VTech Holdings Ltd Annual Report 2011 49
11 Stocks
(a) Inventories in the consolidated balance sheet comprise:
2011
US$ million
2010
US$ million
Raw materials 73.5 67.5
Work in progress 29.5 19.6
Finished goods 126.8 72.2
229.8 159.3
Stocks carried at net realisable value at 31 March 2011 amounted
to US$7.8 million (2010: US$16.8 million).
(b) The analysis of the amount of inventories recognised as an
expense and included in the consolidated income statement
is as follows:
2011
US$ million
2010
US$ million
Carrying amount of inventories sold 1,145.3 972.9
Write-down of inventories 4.1 7.2
Reversal of write-down of inventories (3.5) (7.2)
1,145.9 972.9
The reversal of write-down of inventories made in prior years
arose due to an increase in estimated net realisable value of
certain products as a result of change in consumer preferences.
12 Debtors, Deposits and Prepayments
Note
2011
US$ million
2010
US$ million
Trade debtors (Net of
allowance for doubtful
debts of US$7.9 million
(2010: US$8.8 million)) 12(a) & (b) 198.8 185.7
Other debtors, deposits
and prepayments 23.7 23.7
Forward foreign exchange
contracts
– held as cash flow
hedging
instruments 19(b) & (d) 0.3 –
– held as fair value
through profit
or loss 19(b) & (d) 0.2 0.3
Pension assets 16 2.0 1.7
225.0 211.4
Other debtors, deposits and prepayments are expected
to be recovered within one year except for US$2.5 million
(2010: US$2.2 million) to be settled after one year.
(a) Ageing Analysis
An ageing analysis of net trade debtors by transaction date is as
follows:
2011
US$ million
2010
US$ million
0-30 days 110.0 101.4
31-60 days 60.2 53.8
61-90 days 22.6 28.4
>90 days 6.0 2.1
Total 198.8 185.7
The majority of the Group’s sales are on letter of credit and on
open credit with varying terms of 30 to 90 days. Certain open
credit sales are covered by credit insurance or bank guarantees.
(b) Impairment of trade debtors
Impairment losses in respect of trade debtors are recorded using
an allowance account unless the Group is satisfied that recovery
of the amount is remote, in which case the impairment loss is
written off against trade debtors directly.
At 31 March 2011, the Group’s trade debtors of US$7.9 million
(2010: US$8.8 million) were individually determined to be
impaired as management considered that these receivables
cannot be recovered. Consequently, full provisions for these
doubtful debts were recognised.
The movement in the allowance for doubtful debts during the
year, including both specific and collective loss components,
is as follows:
Note
2011
US$ million
2010
US$ million
At 1 April 8.8 7.7
Impairment loss recognised 2 0.2 4.1
Reversal of impairment loss
of trade debtors 2 (0.9) (0.5)
Uncollectible amounts
written off (0.3) (2.8)
Effect of changes in
exchange rates 0.1 0.3
At 31 March 7.9 8.8
(c) Trade debtors that are not impaired
As at 31 March 2011, 96% (2010: 95%) of the Group’s trade
debtors were not impaired, of which 99% (2010: 100%) was either
not past due or less than two months past due. Based on past
experience of the Group, it is determined that no impairment
allowance is necessary in respect of these balances as these
balances are considered to be fully recoverable. The Group does
not hold any collateral over these balances.