IGO Interactive Annual Report 2019

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 30 JUNE 2019 Notes to the consolidated financial statements 30 June 2019 (continued) 21 Financial risk management (continued) (a) Market risk (continued) (iv) Cash flow and fair value interest rate risk (continued) Impact on post-tax profit Sensitivity of interest revenue and expense to interest rate movements 2019 $'000 2018 $'000 Interest revenue Increase 1.0% (2018: 1.0%) 2,425 957 Decrease 1.0% (2018: 1.0%) (2,425) (957) Interest expense Increase 1.0% (2018: 1.0%) (600) (1,000) Decrease 1.0% (2018: 1.0%) 600 1,000 (b) Credit risk Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has a strict code of credit, including only transacting with high quality financial institutions and customers with an appropriate credit history. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the balance sheet and notes to the financial statements. The Group does not hold any collateral. The maximum exposure to credit risk at the reporting date was as follows: 2019 $'000 2018 $'000 Financial assets Cash and cash equivalents 348,208 138,688 Trade receivables 24,568 50,858 Other receivables 36,017 70,796 Financial assets at fair value through profit or loss 27,531 24,294 Derivative financial instruments 484 1,990 436,808 286,626 (i) Impairment of financial assets The Group has two types of financial assets that are subject to the expected credit loss model: • trade receivables, and • other receivables and financial assets. While cash and cash equivalents are also subject to the impairment requirements of AASB 9, no impairment loss was identified. Trade receivables The Group has adopted a lifetime expected loss allowance in estimating expected credit losses to trade receivables through the use of a provisions matrix using fixed rates of credit loss provisioning. These provisions are considered representative across all customers of the Group based on recent sales experience, historical collection rates and forward-looking information that is available. The Group has policies in place to ensure that sales of products are made to customers with an appropriate credit history. Independence Group NL 43 IGO ANNUAL REPORT 2019 — 105