KU Financial Report
Notes to the Financial Statements
Continued...
(c) Financial Risk Management Objectives
The Board and Management manage the financial risks relating to operations of the company. These include
credit risk, liquidity risk, interest rate risk and market risk.
The company does not enter into or trade financial instruments for speculative purposes. The company does not
use derivative financial instruments.
The company’s investments expose it primarily to the financial risks of changes in interest rate and market fair
value adjustments.
(d) Significant Accounting Policies
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis
of measurement and the basis on which revenues and expenses are recognised, in respect of each class of financial
asset, financial liability and equity instruments are disclosed in note 2 to the financial statements.
(e) Interest Rate Risk Management
The company is exposed to interest rate risk as it invests its surplus funds in variable rate instruments. The risk is
managed by regular review of its variable interest rate investments.
The following table details the company’s exposure to interest rate risk at the balance date:
Revenue
Average
Interest
rate % Variable
Interest rate $ $ $
6.88% 16,148,516 - Receivables and other
current assets - - - Investment in
Managed Funds -
2008
Fixed Interest Rate Maturity
Less than 1
1 to 5 Years More than 5
Year
Years
Non-interest
Bearing Total
$ $ $
- - - 16,148,516
- - 2,066,458 2,066,458
6,512,103 6,512,103
Financial Assets
Cash
Financial Liabilities
Payables
36
KU Children’s Services
16,148,516 - - - 8,578,561 24,727,077
- - - - - 17,636,277 17,636,277
- - - - - 17,636,277 17,636,277