Notes to the consolidated financial statements 30 June 2022 (continued) 1 Segment information (continued) (f) Segment liabilities A reconciliation of reportable segment liabilities to total liabilities is as follows: 2022 $M 2021 $M Total liabilities for reportable segments 221.4 104.3 Unallocated liabilities: Deferred tax liabilities 137.0 108.5 Unallocated creditors and accruals 72.6 13.2 Provision for employee entitlements of the parent entity 7.7 5.8 Bank loans, net of capitalised borrowing costs 890.0 - Corporate lease liabilities 4.3 5.0 Current tax liabilities 77.0 172.0 Total liabilities as per the balance sheet 1,410.0 408.8 2 Revenue 2022 $M 2021 $M From continuing operations Sales revenue from contracts with customers Sale of goods revenue 835.6 614.0 Shipping and insurance service revenue 9.6 5.8 845.2 619.8 Other revenue Interest revenue 2.2 2.9 Provisional pricing adjustments 55.4 49.0 57.6 51.9 Total revenue 902.8 671.7 (a) Recognition and measurement (i) Revenue from sale of goods Revenue from the sale of goods is recognised when control of the goods has passed to the buyer based upon agreed delivery terms. Sale of concentrates Revenue from the sale of concentrates is recognised when control has passed to the buyer based upon agreed delivery terms, generally being when the product is loaded onto the ship and the bill of lading received, or delivered to the customer's premises. In cases where control of the product is transferred to the customer before shipping takes place, revenue is recognised when the customer has formally acknowledged their legal ownership of the product, which includes all inherent risks associated with control of the product. In these cases, the product is clearly identified and immediately available to the customer and this is when the performance obligation is met. Notes to the consolidated financial statements 30 June 2022 (continued) 2 Revenue (continued) (a) Recognition and measurement (continued) Sale of concentrates (continued) The price to be received on sales of concentrate is provisionally priced and recognised at the estimate of the consideration receivable that is highly probable of not reversing by reference to the relevant contractual price and the estimated mineral specifications, net of treatment and refining charges where applicable. Subsequently, provisionally priced sales are repriced at each reporting period up until when final pricing and settlement is confirmed, with revenue adjustments relating to the quality and quantity of commodities sold being recognised in Sales revenue. Provisionally priced sales for which price finalisation is referenced to the relevant metal price index have an embedded commodity derivative. The embedded derivative is carried at fair value through profit or loss as part of trade receivables. The period between provisional pricing and final invoices is generally between 30 and 60 days. (ii) Revenue from Services - Shipping and Insurance Sales of nickel and copper concentrates are on terms that include the Group being responsible for shipping and insurance costs. Shipping and insurance is a separate performance obligation from the sale of the commodity with the revenue allocated to shipping and insurance being recognised over the period of transfer to the customer. (iii) Provisional pricing adjustments The Group’s sales contracts may provide for provisional pricing of sales at the time the product is delivered to the vessel, with final pricing determined using the index on or after the vessel’s arrival to the port of discharge. This provisional pricing relates to the quality and quantity of the commodity sold, which is included in sales revenue, and an embedded derivative relating to the pricing of the commodity sold. Provisional pricing adjustments relating to the embedded derivative are separately identified as movements in the financial instrument rather than being included within Sales revenue. The final pricing adjustment mechanism, being an embedded derivative, is separated from the host contract and recognised at fair value through profit or loss. These amounts are disclosed separately as Provisional pricing adjustments in Other revenue, rather than being included within Sales revenue for the Group. (iv) Interest revenue Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. (b) Key estimates and judgements Judgement is exercised in estimating variable consideration. This is determined by past experience with respect to the goods returned to the Group where the customer maintains a right of return pursuant to the customer contract or where goods or services have a variable component. Revenue will only be recognised to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognised under the contract will not occur when the uncertainty associated with the variable consideration is subsequently resolved. 3 Other income 2022 $M 2021 $M From continuing operations Net foreign exchange gains - 3.6 Net gain on disposal of property, plant and equipment - 0.1 - 3.7 Notes to the consolidated financial statements 30 June 2022 Notes to the consolidated financial statements 30 June 2022 96 — IGO ANNUAL REPORT 2022 IGO ANNUAL REPORT 2022 — 97
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