67 Westgold Resources Limited Annual Report 2022 4. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED) Interest rate risk exposure Post tax profit higher (lower) Other Comprehensive Income higher (lower) 30 June 2022 30 June 2021 30 June 2022 30 June 2021 Judgements of reasonably possible movements: + 1.0% (100 basis points) 1,278,911 1,054,788 – – - 1.0% (100 basis points) (1,278,911) (1,054,788) – – (b) Credit risk Credit risk arises from the financial assets of the Group, which comprises cash and cash equivalents, trade and other receivables, financial assets representing listed shares and other financial assets held as security and loans. Cash and cash equivalents are held with National Australia Bank, which is an Australian Bank with an AA- credit rating (Standard & Poor’s). The Group’s exposure to credit risk arises from potential default of the counter party, with the maximum exposure equal to the carrying amount of the financial assets (as outlined in each applicable note). The Group does not hold any credit derivatives to offset its credit exposure. The Group trades only with recognised, creditworthy third parties and as such collateral is not requested nor is it the Group’s policy to securitise its trade and other receivables. Receivable balances are monitored on an ongoing basis with the result that the Group does not have a significant exposure to bad debts. Significant concentrations of credit risk are in relation to cash and cash equivalents with Australian banks. (c) Price risk Equity Security Price Risk The Group’s operations were exposed to equity security price fluctuations arising from investments in equity securities. Refer to Note 15 for details of equity investments at fair value through profit or loss held at 30 June 2022. The Group has equity investments, which have shown volatility in price movements over the year. If security prices varied by 20%, with all other variables held constant, the impact on post tax profits and equity at 30 June, is reflected below: Post tax profit higher (lower) Other Comprehensive Income higher (lower) 30 June 2022 30 June 2021 30 June 2022 30 June 2021 Judgements of reasonably possible movements: Price + 20% 951,903 899,233 – – Price - 20% (951,903) (899,233) – – (d) Liquidity risk Liquidity risk arises from the financial liabilities of the Group and the subsequent ability to meet the obligations to repay the financial liabilities as and when they fall due. The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of hire purchase arrangements. The table below reflects all contractually fixed payables for settlement, repayment and interest resulting from recognised financial liabilities as of 30 June 2022. Cash flows for financial liabilities without fixed amount or timing are based on the conditions existing as 30 June.
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