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Notes to the Financial Statements

FOR THE YEAR ENDED 30 JUNE 2015

NOTE 20

CREDIT AND LIQUIDITY RISK MANAGEMENT

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the Trust. Credit limits have

been established to ensure that the Trust deals only with approved counterparties and that counterparty concentration risk is addressed and the

risk of loss is mitigated. Counterparty exposure is measured as the aggregate of all obligations of any single legal entity or economic entity to the

Trust, after allowing for appropriate set offs which are legally enforceable. A maximum credit limit is allocated to each counterparty based on its

credit rating. The counterparty credit risk associated with investment instruments is assessed based on its outstanding face value.

At 30 June 2015, the aggregate credit risk in respect of cash and cash equivalents is $3,063,262 (2014: $3,437,346).

At 30 June 2015, the aggregate credit risk in respect of derivative financial instruments is nil (2014: nil).

The Responsible Entity undertakes active liquidity and funding risk management to enable the Trust to have sufficient funds available to meet its

financial obligations as and when they fall due, working capital and expected committed capital expenditure requirements. The Responsible Entity

prepares and monitors rolling forecasts of liquidity requirements on the basis of expected cash flow.

Interest bearing liabilities, funding facilities and their maturity profiles are set out in Notes 9 and 13(iii).

NOTE 21

FINANCIAL COVENANTS

The Trust is required to comply with certain financial covenants in respect of its borrowings facilities. The major financial covenants are

summarised as follows:

a) Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) to gross interest expense excluding gains or losses from mark to

market;

– not less than 1.3 times

b) Loan to Value Ratio (LVR) (debt to latest property value);

– not exceed 50%

At and during the years ended 30 June 2015 and 30 June 2014, the Trust was in compliance with all the above financial covenants.

30 Jun 15

30 Jun 14

$’000

$’000

NOTE 22

INTEREST BEARING LIABILITIES, INTEREST AND DERIVATIVE CASH FLOW MATURITY PROFILE

Interest bearing liabilities and interest

Maturity profile of the principal amounts of current and non current interest

bearing liabilities (refer to Note 9) together with the aggregate future

estimated nominal interest thereon is set out below:

Due within one year

7,267

8,672

Due between one and five years

229,026

235,114

Due after five years

55

109

236,348

243,895

Derivatives

Maturity profile of the estimated future nominal cashflows in respect of

interest rate swaps is set out below:

Due within one year

3,452

3,839

Due between one and five years

2,938

4,072

Due after five years

6,390

7,911

NOTE 23

LEASE RECEIVABLES

Operating lease receivables

The property owned by the Trust is leased to third party retailers under operating leases at 30 June 2015.

Lease terms vary between retailers and some leases include percentage rental payments based on sales revenue.

Future minimum rental revenues under non–cancellable operating retail property leases:

Due within one year

41,677

42,375

Due between one and five years

93,325

115,370

Due greater than five years

45,314

40,816

180,316

198,561

These amounts do not include percentage rentals which may become receivable under certain leases on the basis of retailer sales in excess of

stipulated minimums and do not include recovery of outgoings.

22 / Carindale Property Trust

Annual Report 2015