Genetic Signatures

Genetic Signatures Limited – Annual Report 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 30 JUNE 2021 43 Credit risk Credit risk arises from cash and cash equivalents and deposits with banks and financial institutions, as well as credit exposure to domestic and international customers, including outstanding receivables and committed transactions. The Company has policies in place to ensure that sales of products and services are made to customers with an appropriate credit history. The majority of customers have long term relationships with the Company and sales are secured with supply contracts. Sales are secured by letters of credit when deemed appropriate. The Company has policies that limit the maximum amount of credit exposure to any one financial institution. The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to historical information about counterparty default rates. The table below summarises the assets which are subject to credit risk. Consolidated 2021 2020 Financial assets $’000s $’000s Cash and cash equivalents 30,121 31,176 Trade and other receivables 5,373 5,223 Total Financial Assets 35,494 36,399 The group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for trade receivables. Further detail is explained in Note 1(k). Liquidity Risk Liquidity Risk arises from the possibility that the company might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. The company manages this risk through the following mechanisms: - preparing forward-looking cash flow analysis in relation to its operational, development and financing activities; - obtaining funding from a variety of sources including equity issues; - only investing surplus cash with major financial institutions. Financial liability maturity analysis (undiscounted payments) Weighted average interest rate Within 1 Year 1 to 5 Years Total contractual cash flows Total Carrying amount 2021 % $’000s $’000s $’000s $’000s Financial liabilities due for payment Trade and other payables - 3,352 - 3,352 3,352 Lease liabilities 4.5% 340 70 410 399 Total expected outflows 3,692 70 3,762 3,751 Weighted average interest rate Within 1 Year 1 to 5 Years Total contractual cash flows Total Carrying amount 2020 $’000s $’000s $’000s $’000s Financial liabilities due for payment Trade and other payables - 2,368 - 2,368 2,368 Lease liabilities 4.5% 368 441 809 741 Total expected outflows 2,736 441 3,177 3,109 Financial Report