Note 14: Receivables (continued)
| Actual | ||
|---|---|---|
|
30 June 2012 $m |
30 June 2011 $m |
|
Social Benefit Receivables |
||
| Gross social benefit receivables | 1,130 | 1,050 |
| Impairment of social benefit receivables | (628) | (570) |
| Total social benefit receivables | 502 | 480 |
Impairment of Social Benefit Receivables |
||
| Opening balance | 570 | 521 |
| Impairment losses recognised during the year | 69 | 60 |
| Amounts written off as uncollectible | (11) | (11) |
| Closing balance | 628 | 570 |
| Collective impairment allowance | 628 | 570 |
| Individual impairment allowance | - | - |
| Impairment of Social Benefit Receivables | 628 | 570 |
Ageing of Social Benefit Receivables Past Due But Not Impaired |
||
| Less than six months | 70 | 78 |
| Between six months and one year | 28 | 23 |
| Greater than one year | - | - |
| Total social benefit receivables past due but not impaired | 98 | 101 |
Social benefit receivables comprise benefit overpayments, advances on benefits and recoverable special needs grants primarily administered by the Ministry of Social Development with a carrying value of $490 million (2011: $466 million). The recoverable amount of social benefit receivables is determined by discounting the expected future cash flows (net of estimated service costs).
Their carrying amount provides a reasonable approximation of their fair value.
|
30 June 2012 $m |
30 June 2011 $m |
|
|---|---|---|
Recoveries from Deposit Guarantee Scheme receiverships |
||
| Opening balance of recoveries expected from receiverships | 739 | 13 |
| Recoveries expected from entities defaulting during the year | - | 1,104 |
| Revision of expected recoveries | 90 | (236) |
| Transfer of non-cash assets from South Canterbury Finance receivership into Crown Asset Management Limited1 | (92) | - |
| Payments received from receivers | (467) | (142) |
| Closing balance | 270 | 739 |
| Total payments to depositors under the Guarantee scheme | 34 | 1,897 |
As a consequence of payments made to depositors of failed finance companies under the deposit guarantee scheme, the Crown has inherited the beneficial interest in the proceeds that can be recovered from the secured assets of the receiverships. The reported receivables represent the receivers’ best prudent estimates of likely recoveries from the receiverships. However the eventual return to the Crown is dependent upon the value that can be realised from these entities’ assets and the timing of receipts. A range of outcomes for eventual recoveries is possible. The Crown monitors the receiverships to obtain assurance that optimal proceeds are realised as soon as possible.
In addition to Retail Deposit Guarantee Scheme, the Government operated an opt-in wholesale scheme from November 2008 to April 2010. As at 30 June 2012, 15 guarantee certificates remained in place (value of $3.7 billion). No provision is made for losses under this scheme as the probability of loss is considered remote.
1. During the year the remaining assets of South Canterbury Finance Limited were transferred to a newly established Government reporting entity, Crown Asset Management Limited.
| Actual | ||
|---|---|---|
|
30 June 2012 $m |
30 June 2011 $m |
|
Trade and Other Receivables |
||
| Gross trade and other receivables | 9,753 | 10,009 |
| Impairment of trade and other receivables | (93) | (82) |
| Total trade and other receivables | 9,660 | 9,927 |
Impairment of Trade and Other Receivables |
||
| Opening balance | 82 | 65 |
| Impairment losses recognised during the year | 20 | 33 |
| Amounts written off as uncollectible | (14) | (15) |
| Impairment losses reversed | 5 | (1) |
| Closing balance | 93 | 82 |
| Collective impairment allowance | 69 | 68 |
| Individual impairment allowance | 24 | 14 |
| Impairment of Trade and Other Receivables | 93 | 82 |
Ageing of Trade and Other Receivables Past Due But Not Impaired |
||
| Less than six months | 248 | 175 |
| Between six months and one year | 5 | 9 |
| Greater than one year | 2 | 5 |
| Total trade and other receivables past due but not impaired | 255 | 189 |
Trade and other receivables include $5,003 million relating to reinsurance receivables in Southern Response and EQC (2011: $5,381 million). The rest of the trade and other receivables are short term, with $4,273 million (2011: $4,310 million) expected to be settled in the next year. Their carrying amount provides a reasonable approximation of their fair value.
| Actual | ||
|---|---|---|
|
30 June 2012 $m |
30 June 2011 $m |
|
Reinsurance receivable |
||
| Opening balance | 5,381 | - |
| Reinsurance recognised during the year | 407 | 4,269 |
| Reinsurance acquired through business combination | - | 1,147 |
| Reinsurance received during the year | (785) | (35) |
| Closing balance | 5,003 | 5,381 |
Credit risk associated with reinsurance receivables is managed by ensuring the risk is spread across a number of different reinsurers with appropriate credit ratings.
