12. Advances and investments
| 2019 |
| 2018 |
|Less: Loss allowance||0||0|
|TOTAL ADVANCES AND INVESTMENTS||3,332||5,332|
Advances paid are recognised initially at fair value plus or minus relevant transaction costs and are recognised in the balance sheet when the department becomes party to the contractual provisions of the financial instruments. Where the advances are provided with interest-free periods or at concessional interest rates, they are considered to have a fair value which is less than the amount lent. This fair value is calculated in accordance with Note 20.
Subsequently, advances paid are measured at amortised cost using the effective interest method.
Loss allowances on advances paid reflect either 12-month or lifetime expected credit losses depending on whether there has been a significant increase in credit risk since initial recognition.
Credit risk exposure of advances paid
Advances paid relates to concessional loans approved under the Farm Finance Concessional Loans Scheme funded by the Australian Government. Queensland Rural and Industry Development Authority (QRIDA) manages these concessional loans on behalf of the Northern Territory Government.
QRIDA has conducted an impairment assessment in accordance with AASB 9 at the reporting date. No loans were identified as requiring impairment as a result of the review.
Credit risk for the comparative year is assessed under AASB 139 and is based on objective evidence of impairment. No loss allowance was recorded for advances paid.
ANNUAL REPORT 2018-19 - DEPARTMENT OF PRIMARY INDUSTRY AND RESOURCES
Last updated: 23 October 2019
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