International Financial Reporting Standards (IFRS)

FACT SHEET April 2010 IFRS 7 Financial Instruments: Disclosure

(This fact sheet is based on the standard as at 1 January 2010.) Important note: This fact sheet is based on the requirements of the International Financial Reporting Standards (IFRSs). In some jurisdictions, the IFRSs are adopted in their entirety, in other jurisdictions the individual IFRSs are amended. In some jurisdictions the requirements of a particular IFRS may not have been adopted. Consequently, users of the fact sheet in various jurisdictions should ascertain for themselves the relevance of the fact sheet to their particular jurisdiction. The application date included below is the effective date of the most recent changes made to the standard. IASB application date (non-jurisdiction specific) IFRS 7 is applicable for annual reporting periods commencing on or after 1 July 2009.

Objective
IFRS 7 requires entities to provide disclosures in their financial statements that enable users to evaluate: the significance of financial instruments for the entitys financial position and performance, and the nature and extent of risks arising from financial instruments to which the entity is exposed during the period and at the end of the reporting period and how the entity manages the risk. The principles outlined in IFRS 7 complement the principles for recognising, measuring and presenting financial assets and financial liabilities in IAS 32 Financial Instruments: Presentation and IAS 39 Financial Instruments: Recognition and Measurement.

SCOPE
IFRS 7 applies to all financial instruments except for: interests in subsidiaries, associates, and joint ventures accounted for under IAS 27 Consolidated and Separate Financial Statements, IAS 28 Investments in Associates or IAS 31 Interest in Joint Ventures unless these standards require IAS 39 to be applied employers rights and obligations under employee benefit plans to which IAS 19 Employee Benefits applies insurance contracts as defined in IFRS 4 Insurance Contracts; however, IFRS 7 applies to derivatives that are embedded in insurance contracts if IAS 39 requires an entity to account for them separately financial instruments, contracts and obligations under share-based payment transactions to which IFRS 2 Share-based Payment applies puttable instruments that are required to be classified as equity instruments. Furthermore, the standard applies to contracts to buy or sell a non-financial item that are within the scope of IAS 39.

PRESCRIBED ACCOUNTING TREATMENT

The main principle of disclosure for IFRS 7 is that an entity shall disclose information that enables users of its financial report to evaluate the significance of financial instruments for its financial position and performance. There are no recognition or measurement criteria included within IFRS 7.

International Financial Reporting Standards (IFRS)

DISCLOSURES
Refer Appendix 1 for a detailed checklist to assist with IFRS 7 disclosure requirements; however some of the more significant disclosures have been described below:

Statement of financial position

The carrying amount of each of the following categories is disclosed either in the statement of financial position or in the notes: a) financial assets at fair value through profit or loss, showing separately i. those designated as such upon initial recognition, and ii. those classified as held for trading in accordance with IAS 39 b) held-to-maturity investments c) loans and receivables d) available-for-sale financial assets e) financial liabilities at fair value through profit or loss, showing separately i. those designated as such upon initial recognition, and ii. those classified as held for trading in accordance with IAS 39 f) financial liabilities measured at amortised cost.

Allowance account for credit losses

When financial assets are impaired by credit losses and the entity records the impairment in a separate account, it shall disclose a reconciliation of changes in the account during the period for each class of financial assets, for example bad debt provisions.

Defaults and breaches

For loans payable recognised at the reporting date, an entity shall disclose details of any defaults, the carrying amount of the loan in default and whether the default was remedied or renegotiated before the financial statements was authorised for issue.

Statement of comprehensive income

An entity shall disclose the following items of income, expense, gains or losses either on the face of the financial statements or in the notes: a) net gains or net losses on all financial instruments separated into classes b) total interest income and total interest expense for financial assets or financial liabilities that are not at fair value through profit or loss c) fee income and expense from financial assets or financial liabilities that are not at fair value through profit or loss, and trust/ fiduciary activities (holding or investing of assets on behalf of) d) interest income on impaired financial assets e) the amount of any impairment loss for each class of financial asset.

Other disclosures
Accounting policies Disclosure of the measurement bases and other accounting policies used in preparing the financial statements that are relevant to an understanding of the financial statements. Hedge accounting An entity shall disclose the following details separately for each type of hedge described in IAS 39 (i.e. fair value hedges, cash flow hedges, and hedges of net investments in foreign operations): a) description of each type of hedge b) description of the financial instruments designated as hedging instruments and their fair values at the reporting date c) the nature of the risks being hedged. In relation to cash flow hedges, an entity shall disclose separately: a) the periods when the cash flows are expected to occur and when they are expected to affect the profit or loss b) a description of any forecast transaction for which hedge accounting had previously been used, but which is no longer expected to occur
2

International Financial Reporting Standards (IFRS)

c) the amount that was recognised in equity during the period d) the amount that was removed from equity during the period and included in profit or loss for the period e) the amount that was removed from equity during the period and included in the initial cost or other carrying amount of a non-financial asset or non-financial liability whose acquisition or incurrence was a hedged highly probable forecast transaction. Fair value For each class of financial assets and financial liabilities, an entity shall disclose the fair value of that class of assets and liabilities so as to permit comparisons with its carrying amount. Fair value measurements are to be classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy should have the following levels: a) quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1) b) inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (Level 2) and c) inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3). Disclosures of fair value are not required: a) where the carrying amount is a reasonable approximation of fair value; e.g. short term trade receivables and payables b) investment in equity instruments that do not have a quoted market price in an active market or derivatives linked to such equity instruments, that is measured at cost in accordance with IAS 39 because the fair value cannot be reliably measured c) for a contract containing a discretionary participation feature (as described in IFRS 4 Insurance Contracts) if the fair value of that feature cannot be measured reliably.

NATURE AND EXTENT OF RISKS ARISING FROM FINANCIAL INSTRUMENTS

An entity shall disclose information that enables users of its financial statements to evaluate the nature and extent of risks arising from financial instruments to which the entity is exposed at the end of the reporting period. The required disclosures focus on the risks that arise from financial instruments and the risk management initiatives. The following types of risks are typically included but not limited to: (i) credit risk, (ii) liquidity risk and (iii) market risk. Qualitative and quantitative disclosures are required to elaborate on the nature and extent of risks arising from the financial instruments. Qualitative disclosures shall include the exposures to risk and how they arise, the objectives, policies and processes for managing the risk and the methods used to measure the risk, and any changes in exposure and risk management from the previous period. Quantitative disclosures shall comprise of data about its exposure to that risk (including concentration of risk) at reporting date. Credit risk By class of financial instrument, an entity shall disclose: the amount that best represents its maximum exposure to credit risk at the end of the reporting period without taking account of any collateral held or credit enhancements, description of collateral as security, information about the credit quality of financial assets that are neither past due nor impaired, and the carrying amount of financial assets that would otherwise be past due or impaired whose terms have been renegotiated. Liquidity risk An entity shall disclose a maturity analysis for financial liabilities that shows the remaining contractual maturities, and a description of the corresponding liquidity risk management. Market risk An entity shall disclose a sensitivity analysis for each type of market risk to which the entity is exposed at the reporting date.

International Financial Reporting Standards (IFRS)

The sensitivity analysis shows: how profit or loss and equity would have been affected by changes in the relevant risk variable that were reasonably possible at that reporting date. the methods and assumptions used in preparing the sensitivity analysis, and changes in the methods and assumptions from the previous period. If the entity prepares a value-at-risk sensitivity analysis that reflects interdependencies between risk variables (e.g. interest rates and exchange rates) and uses it to manage financial risks, it may use such a sensitivity analysis. Likewise, the entity shall also disclose an explanation of the method used in preparing the analysis including the parameters and assumptions. An explanation of the objective of the method used and limitations that may result in the information not fully reflecting the fair value shall be disclosed.

Important definitions
Credit risk Currency risk Interest rate risk Liquidity risk Loans payable Market risk risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rate. risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. financial liabilities, other than short term trade payables on normal credit terms. risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises of currency risk, interest rate risk and other price risk. Other price risk Risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market. results if a counterparty fails to make a payment on a financial asset when the asset is contractually due.

Past due

Australian specific requirements

The Australian equivalent standard is AASB 7 which is applicable for annual reporting periods beginning on or after 1 July 2009.

International Financial Reporting Standards (IFRS)

Appendix 1 Disclosure checklist
This checklist can be used to review your financial statements you should complete the Yes / No / N/A column about whether the requirement is included and provide an explanation for No answers to ensure the completeness of disclosures. Yes / No / N/A Statement of Financial Position Categories of financial assets and financial liabilities IFRS 7.8 Have the carrying amounts of each of the following categories, as defined in IAS 39, been disclosed either on the face of the Statement of Financial Position or in the notes: a) financial assets at fair value through profit or loss, showing separately: those designated as such upon initial recognition; and those classified as held for trading in accordance with IAS 39; b) held-to-maturity investments; c) loans and receivables; d) available-for-sale financial assets; e) financial liabilities at fair value through profit or loss, showing separately those designated as such upon initial recognition; and those classified as held for trading in accordance with IAS 39; and f) financial liabilities measured at amortised cost. Does the entity have any financial assets or financial liabilities at fair value through profit or loss? If no, then do not complete IFRS 7.9 and 7.10 IFRS 7.9 If the entity has designated a loan or receivable (or group of loans or receivables) as at fair value through profit or loss, has the entity disclosed: a) the maximum exposure to credit risk of the loan or receivable (or group of loans or receivables) at the reporting date; b) the amount by which any related credit derivatives or similar instruments mitigate that maximum exposure to credit risk; c) the amount of change, during the period and cumulatively, in the fair value of the loan or receivable (or group of loans or receivables) that is attributable to changes in the credit risk of the financial asset determined either: as the amount of change in its fair value that is not attributable to changes in market conditions that give rise to market risk; or using an alternative method the entity believes more faithfully represents the amount of change in its fair value that is attributable to changes in the credit risk of the asset; d) the amount of the change in the fair value of any related credit derivatives or similar instruments that has occurred during the period and cumulatively since the loan or receivable was designated. Explanation (if required)

IFRS 7: Financial Instruments: Disclosures Applicable for financial statement periods ending on or after 1 July 2009.

International Financial Reporting Standards (IFRS)

Yes / No / N/A IFRS 7.10 If the entity has designated a financial liability as at fair value through the profit or loss in accordance with paragraph 9 of IAS 39, has the entity disclosed: a) the amount of change, during the period and cumulatively, in the fair value of the financial liability that is attributable to changes in the credit risk of that liability determined either: as the amount of change in its fair value that is not attributable to changes in market conditions that give rise to market risk; or using an alternative method the entity believes more faithfully represents the amount of change in its fair value that is attributable to changes in the credit risk of the liability; b) the difference between the financial liabilitys carrying amount and the amount the entity would be contractually required to pay at maturity to the holder of the obligation. IFRS 7.11 Has the entity disclosed: a) the methods used to comply with the requirements in paragraphs 9(c) and 10(a); and b) if the entity believes that the disclosure it has given to comply with the requirements in paragraph 9(c) or 10(a) does not faithfully represent the change in the fair value of the financial asset or financial liability attributable to changes in its credit risk, the reasons for reaching this conclusion and the factors it believes are relevant. Has the entity reclassified any fixed asset between categories? If no, then do not complete IFRS 7.12 and 7.13 IFRS 7.12 If the entity has reclassified a financial asset as one measured: a) at cost or amortised cost, rather than at fair value; or b) at fair value, rather than at cost or amortised cost, has the entity disclosed the amount reclassified into and out of each category and the reason for that reclassification. IFRS 7.12A If the entity has reclassified a financial asset out of the fair value through profit or loss category or out of the available-for-sale category; has the following been disclosed: the amount reclassified into and out of each category for each reporting period until derecognition, the carrying amounts and fair values of all financial assets that have been reclassified in the current and previous reporting periods if a financial asset was reclassified, the rare situation, and the facts and circumstances indicating that the situation was rare for the reporting period when the financial asset was reclassified, the fair value gain or loss or other comprehensive income in that reporting period and in the previous reporting period for each reporting period following the reclassification until derecognition of the financial asset, the fair value gain or loss that would have been recognised in profit or loss or other comprehensive income if the financial asset had not been reclassified, and the gain, loss, income and expense recognised in profit or loss and the effective interest rate and estimated amounts of cash flows the entity expects to recover, as at the date of reclassification of the financial asset. Explanation (if required)

International Financial Reporting Standards (IFRS)

Yes / No / N/A IFRS 7.13 An entity may have transferred financial assets in such a way that part or all of the financial assets do not qualify for derecognition, for such financial assets, has the entity disclosed? a) the nature of the assets; b) the nature of the risks and rewards of ownership to which the entity remains exposed; c) when the entity continues to recognise all of the assets, the carrying amounts of the assets and of the associated liabilities; and d) when the entity continues to recognise the assets to the extent of its continuing involvement, the total carrying amount of the original assets, the amount of the assets that the entity continues to recognise, and the carrying amount of the associated liabilities. Does the entity hold any collateral or has the entity pledged any collateral? If no, do not complete IFRS 7.14 or IFRS 7.15 IFRS 7.14 Has the entity disclosed: a) the carrying amount of financial assets it has pledged as collateral for liabilities or contingent liabilities, including amounts that have been reclassified in accordance with paragraph 37(a) of IAS 39; and b) the terms and conditions relating to its pledge. IFRS 7.15 When an entity holds collateral (of financial or non-financial assets) and is permitted to sell or repledge the collateral in the absence of default by the owner of the collateral, has the entity disclosed: a) the fair value of the collateral held; b) the fair value of any such collateral sold or repledged, and whether the entity has an obligation to return it; and c) the terms and conditions associated with its use of the collateral. Has the entity impaired any financial assets for credit losses, e.g. bad debt provision? If no, do not complete IFRS 7.16 IFRS 7.16 When financial assets are impaired by credit losses and the entity records the impairment in a separate account (e.g. an allowance account used to record individual impairments or a similar account used to record a collective impairment of assets) rather than directly reducing the carrying amount of the asset, has the entity disclosed a reconciliation of changes in that account during the period for each class of financial assets? Explanation (if required)

Has the entity issued any compound financial instruments with multiple embedded derivatives? If no, do not complete IFRS 7.17 IFRS 7.17 If an entity has issued an instrument that contains both a liability and an equity component (see paragraph 28 of IAS 32) and the instrument has multiple embedded derivatives whose values are interdependent (such as a callable convertible debt instrument), has the entity disclosed the existence of those features?

International Financial Reporting Standards (IFRS)

Yes / No / N/A Does the entity have any loans payable at reporting date? If no, do not complete IFRS 7.18 and 7.19 IFRS 7.18 For loans payable recognised at the reporting date, has the entity disclosed: a) details of any defaults during the period of principal, interest, sinking fund, or redemption terms of those loans payable; b) the carrying amount of the loans payable in default at the reporting date; and c) whether the default was remedied, or the terms of the loans payable were renegotiated, before the financial statement was authorised for issue. IFRS 7.19 Where there were other breaches of loan agreements, has the entities disclosed the information required by IFRS 7.18 if the breaches permitted the lender to demand accelerated repayments (unless the breaches were remedied or the terms of the loan were renegotiated, on or before the reporting date)? Explanation (if required)

Income statement and equity Items of income, expense, gains or losses IFRS 7.20 Has the entity disclosed the following items of income, expense, gains or losses either on the face of statement of comprehensive income or in the notes: a) net gains or net losses on: financial assets or financial liabilities at fair value through profit or loss, showing separately those on financial assets or financial liabilities designated as such upon initial recognition, and those on financial assets or financial liabilities that are classified as held for trading in accordance with IAS 39; available-for-sale financial assets, showing separately the amount of gain or loss recognised in other comprehensive income during the period and the amount removed from equity and recognised in profit or loss for the period; held-to-maturity investments; loans and receivables; and financial liabilities measured at amortised cost; b) total interest income and total interest expense (calculated using the effective interest method) for financial assets or financial liabilities that are not at fair value through profit or loss; c) fee income and expense (other than amounts included in determining the effective interest rate) arising from: financial assets or financial liabilities that are not at fair value through profit or loss; and trust and other fiduciary activities that result in the holding or investing of assets on behalf of individuals, trusts, retirement benefit plans, and other institutions; d) interest income on impaired financial assets accrued in accordance with paragraph AG93 of IAS 39; and e) the amount of any impairment loss for each class of financial asset.

International Financial Reporting Standards (IFRS)

Yes / No / N/A Other disclosures Accounting policies IFRS 7.21 Has the entity disclosed, in the summary of significant accounting policies, the measurement basis (or bases) used in preparing the financial statement and the other accounting policies used that are relevant to an understanding of the financial statement? Explanation (if required)

Does the entity follow hedge accounting? If no, do not complete IFRS 7.22 7.24 IFRS 7.22 Has the entity disclosed the following separately for each type of hedge described in IAS 39 (i.e. fair value hedges, cash flow hedges, and hedges of net investments in foreign operations): a) a description of each type of hedge; b) a description of the financial instruments designated as hedging instruments and their fair values at the reporting date; and c) the nature of the risks being hedged. IFRS 7.23 Where the entity has cash flow hedges, has the following been disclosed: a) the periods when the cash flows are expected to occur and when they are expected to affect profit or loss; b) a description of any forecast transaction for which hedge accounting had previously been used, but which is no longer expected to occur; c) the amount that was recognised in other comprehensive income during the period; d) the amount that was removed from equity and included in profit or loss for the period, showing the amount included in each line item in the statement of comprehensive income; and e) the amount that was removed from equity during the period and included in the initial cost or other carrying amount of a non-financial asset or non-financial liability whose acquisition or incurrence was a hedged highly probable forecast transaction. IFRS 7.24 Has the entity disclosed separately: a) in fair value hedges, gains or losses: on the hedging instrument; and on the hedged item attributable to the hedged risk; b) the ineffectiveness recognised in profit or loss that arises from cash flow hedges; and c) the ineffectiveness recognised in profit or loss that arises from hedges of net investments in foreign operations.

International Financial Reporting Standards (IFRS)

Yes / No / N/A Fair value IFRS 7.25 Has the entity disclosed the fair value of each class of financial assets and financial liabilities in a way that permits it to be compared with its carrying amount? Exceptions to this disclosure are as follows (per IFRS 7.29): a) when the carrying amount is a reasonable approximation of fair value, for example, for financial instruments such as short-term trade receivables and payables; b) for an investment in equity instruments that do not have a quoted market price in an active market, or derivatives linked to such equity instruments, that is measured at cost in accordance with IAS 39 because its fair value cannot be measured reliably; or c) for a contract containing a discretionary participation feature (as described in IFRS 4) if the fair value of that feature cannot be measured reliably. IFRS 7.26 Has the entity grouped financial assets and financial liabilities into classes, but offset them only to the extent that their carrying amounts are offset in the Statement of Financial Position in the fair value disclosures? Has the entity disclosed: the methods and, when a valuation technique is used, the assumptions applied in determining fair values of each class of financial assets or financial liabilities. For example, if applicable, an entity discloses information about the assumptions relating to prepayment rates, rates of estimated credit losses, and interest rates or discount rates; Where there has been a change in valuation technique, has that change and reasons for making it been disclosed? IFRS 7.27B For fair value measurements recognised in the statement of financial position, has the entity disclosed, for each class of financial instruments: a) the level in the fair value hierarchy into which the fair value measurements are categorised in their entirety, segregating fair value measurements in accordance with the levels defined in paragraph 27A b) any significant transfers between Level 1 and Level 2 of the fair value hierarchy and the reasons for those transfers. Have transfers into each level been disclosed and discussed separately from transfers out of each level. c) For fair value measurements in Level 3 of the fair value hierarchy, is there a reconciliation from the beginning balances to the ending balances, disclosing separately changes during the period attributable to the following: i. Total gains or losses for the period recognised in profit or loss, and a description of where they are presented in the statement of comprehensive income or the separate income statement (if presented) ii. Total gains or losses recognised in other comprehensive income iii. Purchases, sales, issues and settlements (each type of movement disclosed separately) and iv. Transfers into or out of Level 3 and the reasons for those transfers. For significant transfers, have transfers into Level 3 been disclosed.
10

Explanation (if required)

IFRS 7.27

International Financial Reporting Standards (IFRS)

Yes / No / N/A d) the amount of total gains or losses for the period in (c)(i) above included in profit or loss that are attributable to gains or losses relating to those assets and liabilities held at the end of the reporting period and a description of where those gains or losses are presented in the statement of comprehensive income or the separate income statement (if presented) e) for fair value measurements in Level 3, if changing one or more of the inputs to reasonably possible alternative assumptions would change fair value significantly, has the entity stated that fact and disclosed the effect of those changes. Has the entity disclosed how the effect of a change to a reasonably possible alternative assumption was calculated? The disclosure required by IFRS 7.27B should be presented in a tabular form unless another format is more appropriate. IFRS 7.28 If the market for a financial instrument is not active, an entity establishes its fair value using a valuation technique. If there is a difference between the fair value at initial recognition, i.e. transaction price and the amount that would be determined at that date using a valuation technique for a financial instrument in a non-active market, has the entity disclosed by class of financial instrument: a) its accounting policy for recognising that difference in profit or loss to reflect a change in factors (including time) that market participants would consider in setting a price; and b) the aggregate difference yet to be recognised in profit or loss at the beginning and end of the period and a reconciliation of changes in the balance of this difference. IFRS 7.30 If exceptions (b) and (c) described in IFRS 7.29 (see IFRS 7.25 above) exist, has the entity disclosed information to help users of the financial statement make their own judgements about the extent of possible differences between the carrying amount of those financial assets or financial liabilities and their fair value, including: a) the fact that fair value information has not been disclosed for these instruments because their fair value cannot be measured reliably; b) a description of the financial instruments, their carrying amount, and an explanation of why fair value cannot be measured reliably; c) information about the market for the instruments; d) information about whether and how the entity intends to dispose of the financial instruments; and e) if financial instruments whose fair value previously could not be reliably measured are derecognised, that fact, their carrying amount at the time of derecognition, and the amount of gain or loss recognised. Nature and extent of risks arising from financial instruments IFRS 7.31 Has the entity disclosed information that enables users of its financial statement to evaluate the nature and extent of risks arising from financial instruments to which the entity is exposed at the reporting date? These typically include but are not limited to credit risk, liquidity risk and market risk. Explanation (if required)

11

International Financial Reporting Standards (IFRS)

Yes / No / N/A Qualitative disclosures IFRS 7.33 For each type of risk arising from financial instruments, has the entity disclosed: a) the exposures to risk and how they arise; b) its objectives, policies and processes for managing the risk and the methods used to measure the risk; and c) any changes in (a) or (b) from the previous period. Quantitative disclosures IFRS 7.34 For each type of risk arising from financial instruments, has the entity disclosed: a) summary quantitative data about its exposure to that risk at the reporting date. This disclosure shall be based on the information provided internally to key management personnel of the entity (as defined in IAS 24 Related Party Disclosures), for example the entitys board of directors or chief executive officer; b) the disclosures required by paragraphs 3642 of IFRS 7 (see below), to the extent not provided in (a), unless the risk is not material; and c) concentrations of risk if not apparent from (a) and (b). IFRS 7.35 If the quantitative data disclosed as at the reporting date are unrepresentative of an entitys exposure to risk during the period, has the entity provided further information that is representative? Explanation (if required)

Is the entity subject to credit risk? If no, do not complete IFRS 7.36 7.38 IFRS 7.36 Has the entity disclosed by class of financial instrument: a) the amount that best represents its maximum exposure to credit risk at the reporting date without taking account of any collateral held or other credit enhancements (e.g. netting agreements that do not qualify for offset in accordance with IAS 32); b) in respect of the amount disclosed in (a), a description of collateral held as security and other credit enhancements; c) information about the credit quality of financial assets that are neither past due nor impaired; and d) the carrying amount of financial assets that would otherwise be past due or impaired whose terms have been renegotiated. IFRS 7.37 Has the entity disclosed by class of financial asset: a) an analysis of the age of financial assets that are past due as at the reporting date but not impaired; b) an analysis of financial assets that are individually determined to be impaired as at the reporting date, including the factors the entity considered in determining that they are impaired; and c) for the amounts disclosed in (a) and (b), a description of collateral held by the entity as security and other credit enhancements and, unless impracticable, an estimate of their fair value.

12

International Financial Reporting Standards (IFRS)

Yes / No / N/A IFRS 7.38 When an entity obtains financial or non-financial assets during the period by taking possession of collateral it holds as security or calling on other credit enhancements (e.g. guarantees), and such assets meet the recognition criteria in other Australian Accounting Standards, has the entity disclosed: a) the nature and carrying amount of the assets obtained; and b) when the assets are not readily convertible into cash, its policies for disposing of such assets or for using them in its operations. Is the entity subject to liquidity risk? If no, do not complete IFRS 7.39 IFRS 7.39 Has the entity disclosed: a) a maturity analysis for non-derivative financial liabilities that shows the remaining contractual maturities; b) a maturity analysis for derivative financial liabilities which included the remaining contractual maturities for those derivative financial liabilities fro which contractual maturities are essential for an understanding of the timing of the cash flows. c) a description of how it manages the liquidity risk inherent in (a) and (b). Is the entity subject to market risk? If no, do not complete IFRS 7.40 7.42 Sensitivity analysis IFRS 7.40 Has the entity disclosed: a) a sensitivity analysis for each type of market risk to which the entity is exposed at the reporting date, showing how profit or loss and equity would have been affected by changes in the relevant risk variable that were reasonably possible at that date; b) the methods and assumptions used in preparing the sensitivity analysis; and c) changes from the previous period in the methods and assumptions used, and the reasons for such changes. IFRS 7.41 As the entity prepare a sensitivity analysis reflecting interdependencies between risk variables which it uses to manage financial risk (e.g. value-atrisk), has the entity provided additional regarding the sensitivity analysis it prepares and: a) an explanation of the method used in preparing such a sensitivity analysis, and of the main parameters and assumptions underlying the data provided; and b) an explanation of the objective of the method used and of limitations that may result in the information not fully reflecting the fair value of the assets and liabilities involved. Other market risk disclosures IFRS 7.42 If the sensitivity analyses disclosed are unrepresentative of a risk inherent in a financial instrument (e.g. because the year-end exposure does not reflect the exposure during the year), has the entity disclosed that fact and the reason it believes the sensitivity analyses are unrepresentative? Explanation (if required)

13

OTHER MATTERS
Legal Notice Copyright CPA Australia Ltd (ABN 64 008 392 452), 2010. All rights reserved. Save and except for direct quotes from the International Financial Reporting Standards (IFRS) and accompanying documents issued by the International Accounting Standards Board (IASB) (IFRS Copyright), all content in these materials is owned by or licensed to CPA Australia. The use of IFRS Copyright in these materials is in accordance with the IASBs Terms and Conditions. All trade marks and trade names are proprietary to CPA Australia and must not be downloaded, reproduced or otherwise used without the express consent of CPA Australia. You may access and display these pages on your computer, monitor or other video display device and make one printed copy of any whole page or pages for personal and professional non-commercial purposes only. You must not (i) reproduce the whole or part of these materials to provide to anyone else; and/or (ii) use these materials to create a commercial product or to distribute them for commercial gain. Disclaimer CPA Australia has used reasonable care and skill in compiling the content of these materials. However, CPA Australia makes no warranty as to the accuracy or completeness of any information contained therein nor does CPA Australia accept responsibility for any acts or omissions in reliance upon these materials. These materials are; (i) intended to be a guide only and no part of these materials are intended to be advice, whether legal or professional; (ii) not a complete representation of the Standard referred to and/or quoted and consequently are no substitute for reading the latest and complete standards. All individuals are advised to seek professional advice to keep abreast of reforms and developments, whether legal or regulatory. Limitation of Liability To the extent permitted by applicable law, CPA Australia, its employees, agents and consultants exclude all liability for any loss or damage claims and expenses including but not limited to legal costs, indirect special or consequential loss or damage (including but not limited to, negligence) arising out of the information in the materials. Where any law prohibits the exclusion of such liability, CPA Australia limits its liability to the re-supply of the information.