Page 151 - HKCAAVQ AR 2018-19

Financial Report ৌਕజѓ

Notes to the Financial Statements (continued)
ৌਕజڌڝൗ€ᚃ

For the year ended 31 March 2019 ࿚Їɚཧɓɘϋɧ˜ɧɤɓ˚˟ϋܓ

21. Financial Instruments (continued) 21. ږፄʈՈ€ᚃ

Financial risk management objectives ৌਕࠬᎈ၍ଣͦᅺʿ݁ഄ
and policies (continued) €ᚃ

Market risk (continued) ̹ఙࠬᎈ€ᚃ

Currency risk (continued) ̮࿆ࠬᎈ€ᚃ

Sensitivity analysis ઽชܓʱؓ

The management considers that, as HK$ is pegged to USD, the ၍ଣᄴႩމd͟׵ಥ࿆ၾߕʩન
Council is not subject to significant foreign currency risk from ནd͉҅Ԩ͊Ϟߕʩгಥ࿆ිଟᜊ
change in foreign exchange rate of USD against HK$. ਗϾኬߧٙࠠɽ̮ිࠬᎈf

Credit risk and impairment assessment ڦ൲ࠬᎈၾಯ࠽൙П

As at 31 March 2019, the Council’s maximum exposure to ׵ɚཧɓɘϋɧ˜ɧɤɓ˚d͉҅
credit risk which will cause a financial loss to the Council due to Ϊ࿁˙ʔᄵБப΂Ͼ˿͉҅ႆա
failure to discharge an obligation by the counterparties is arising ৌਕฦ̰ٙ௰৷ڦ൲ࠬᎈɗৌਕ
from the carrying amount of the respective recognised financial ًرڌהΐ׼ٙ޴ᗫʊᆽႩৌਕ
assets as stated in the statement of financial position. ༟ପٙሪࠦ࠽f

Accounts receivable and contract assets arising from contracts ԸІၾ܄˒ᖦࠈΥߒٙᏐϗሪಛ
with customers ʿΥߒ༟ପ

In order to minimise the credit risk, the management of the މးඎࠥЭڦ൲ࠬᎈd͉҅၍ଣᄴ
Council has delegated a team responsible for determination of ʊ։΂ྠඟࠋபՓ֛ڦ൲ᕘܓeڦ
credit limits, credit approvals and other monitoring procedures ൲ҭࣨʿՉ˼္࿀೻ҏdᆽڭમ՟
over the customers to ensure that follow-up action is taken ༧ආણ݄˸ϗΫགྷಂවධfϤ̮d
to recover overdue debts. In addition, the Council reviews the ͉҅׵΢జѓಂ͋ᄲቡ΢ࡈй൱
recoverable amount of each individual debtor at the end of each ׸වධ̙ٙϗΫږᕘdᆽڭމʔ̙
reporting period to ensure that adequate allowance are made ϗΫږᕘЪ̈ԑ੄ٙ൨ତfϤ̮d
for irrecoverable amounts. In addition, the Council performs ࣬ኽᏐ͜࠰ಥৌਕజѓ๟ۆୋ9໮
impairment assessment under ECL model upon application €ɚཧɓɞjʊ೯͛ฦ̰ᅼۨʘ
of HKFRS 9 (2018: incurred loss model) on trade balances ਿ׵๟௪ॉ৬ٙʹ׸ቱᕘd͉҅ܲ
based on provision matrix. In this regard, the management of ๫ཫಂڦ൲ฦ̰ᅼۨආБಯ࠽൙
the Council consider that the Council’s credit risk is significantly ПfఱϤϾԊd͉҅၍ଣᄴႩމ͉
reduced. ҅ٙڦ൲ࠬᎈʊɽషࠥЭf

The Council’s exposure to credit risk is influenced mainly by ͉҅ࠦᑗٙڦ൲ࠬᎈ˴ࠅաՑӊ
the individual characteristics of each customer. At the end of Τ܄˒ًٙرהᅂᚤf׵జѓಂ
the reporting period, the Council had a certain concentration of ͋d͉҅πίණʕڦ൲ࠬᎈd௰ɽ
credit risk as 50% and 77% (2018: 21% and 51%) of the total ܄˒ձʞɽ܄˒ʱйЦᏐϗሪಛ
accounts receivable that were due from the largest customer ᐼᕘٙ50%ձ77%€ɚཧɓɞϋj
and the five largest customers respectively. 21%ձ51%f

Hong Kong Council for Accreditation of Academic and Vocational Qualifications 151
࠰ಥኪஔʿᔖุ༟ዝ൙ᄲ҅