Genetic Signatures

61 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 30 JUNE 2021 42 Note 27: Financial risk management The company's financial instruments consist mainly of deposits with banks, accounts receivable and payable, and lease liabilities. The totals for each category of financial instruments, measured in accordance with AASB 9 as detailed in the accounting policies to these financial statements, are shown at their net fair value. Net Fair Value The fair values of financial assets and financial liabilities are presented in the following table and can be compared to their carrying values as presented in the statement of financial position. Fair values are those amounts at which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties at arm's length transaction. Fair values derived may be based on information that is estimated or subject to judgment, where changes in assumptions may have material impact on the amounts estimated. The values disclosed in the above table have been determined based on the following methodologies: Cash and cash equivalents, trade and other receivables and trade and other payables are short-term instruments in nature whose carrying value is equivalent to fair value. The fair value of lease liabilities is estimated by discounting the remaining contractual maturities at the current market interest rate that is available for similar financial liabilities. Interest Rate Risk The company's main interest rate risk arises from the cash balance which is invested at variable rates. Sensitivity Significant changes in market interest rates may have an effect on the Company's income and operating cash flows. The Company manages its cash flow interest rate risk by placing excess funds in term deposits. Based on the cash held at reporting date, the sensitivity to a 1% increase or decrease in interest rates would increase/(decrease) after tax profit by $301,000 (2020 loss: $311,000). Net Carrying Value 2021 Net Fair Value 2021 Net Carrying Value 2020 Net Fair Value 2020 Financial assets $’000s $’000s $’000s $’000s Cash and cash equivalents 30,121 30,121 31,176 31,176 Trade and other receivables 5,373 5,373 5,223 5,223 Total Financial Assets 35,494 35,494 36,399 36,399 Financial Liabilities Trade creditors 2,755 2,755 1,779 1,779 Other creditors 597 597 589 589 Lease liabilities 399 399 741 741 Total Financial Liabilities 3,751 3,751 3,109 3,109 Notes to the Financial Statements for the financial year ended 30 June 2021