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Whitehaven Coal Limited : Annual Report 2009
64 NOTES TO THE FINANCIAL STATEMENTS 30 JUNE 2009 5. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED) Risk exposures and responses (continued) Credit risk Credit risk arises from the financial assets of the consolidated entity, which comprise cash and cash equivalents, trade and other receivables, available for sale financial assets, derivative financial instruments and the granting of financial guarantees. The consolidated entity's exposure to credit risk arises from potential default of the counter party, with a maximum exposure equal to the carrying amount of the financial assets, as outlined below. For the Company it arises from receivables due from subsidiaries. Exposure to credit risk The consolidated entity's maximum exposure to credit risk at the reporting date was: Carrying Amount Carrying Amount In thousands of AUD Note 30 June 2009 30 June 2008 Cash and cash equivalents 14 131,159 80,867 Trade and other receivables 15 271,893 76,213 Derivative financial instruments 17 34,255 46,776 Available-for-sale financial assets 18 37 37 437,344 203,893 The company's exposure to credit risk at the reporting date was $276,968,000 (2008: $170,400,000) arising from receivables from subsidiaries. The consolidated entity's maximum exposure to credit risk for trade receivables at the reporting date by geographic region was: Carrying Amount Carrying Amount In thousands of AUD 30 June 2009 30 June 2008 Asia 30,151 30,574 Australia 1,113 1,217 31,264 31,791 Trade and other receivables The Company's and consolidated entity's exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the consolidated entity's customer base, including the default risk of the industry and country in which customers operate, has less of an influence on credit risk. Approximately 39 percent of the consolidated entity's revenue is attributable to sales transactions with two customers (2008: 29%). More than 90 percent of the consolidated entity's customers have been transacting with the consolidated entity for over 5 years, and losses have occurred infrequently. Of the consolidated entity's trade and other receivables, 77% relate to receivables resulting from the sell down of the Narrabri Joint Venture (refer to note 7). The remaining trade and other receivables relate mainly to coal customers. The consolidated entity does not require collateral in respect of trade and other receivables. The consolidated entity trades only with recognised, creditworthy third parties. Receivable balances are monitored on an ongoing basis with the result that the consolidated entity's exposure to bad debts is not significant. The Company and consolidated entity have not recognised any impairment loss for trade and other receivables during the year ended 30 June 2009 (2008: Nil).
Annual Report 2008
Annual Report 2010