McConnell Dowell 2018 Annual Review

McConnell Dowell Financial Statements 2018 33 Consolidated Equity higher / (lower) Equity higher / (lower) Post tax profit higher / (lower) Post tax profit higher / (lower) All figures are in A$ 000’s Note 2018 2017 As at balance date, the Group had the following exposure to interest rates: Financial assets Cash and cash equivalents 141,762 127,562 TOTAL FINANCIAL ASSETS 141,762 127,562 TOTAL EXPOSURE 141,762 127,562 All figures are in A$ 000’s 2018 2017 2018 2017 Consolidated 10% increase in AUD rates with all other variables held constant (430) (1,512) (430) (1,512) 10% decrease in AUD rates with all other variables held constant 525 1,848 525 1,848 A sensitivity of 10% has been selected as this is considered reasonable given the current level of exchange rates and the volatility observed both on a 5 year historical basis and market expectations for potential future movement. All figures are in A$ 000’s 2018 2017 2018 2017 Consolidated 100 basis point increase in interest rates with all other variables held constant 992 893 992 893 100 basis point fall in interest rates with all other variables held constant (992) (893) (992) (893) The following sensitivity analysis is based on the foreign currency risk exposure in existence at the balance date, with all other variables remaining constant: At balance date, had the Australian Dollar moved, as illustrated in the table below, with all other variables held constant, post tax profit and equity would have been affected as follows: Interest rate risk The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s cash and cash equivalents. All interest bearing loans and borrowings (see note 17) are at fixed rates. Given the nature of financial assets and liabilities exposed to interest rate risk, management does not consider interest rates to be a significant risk to the Group. The Group does not have any interest rate swaps in place, but does constantly analyse its interest rate exposure. Within this analysis consideration is given to existing positions, alternative financing and the mix of fixed and variable interest rates. The following sensitivity analysis is based on the interest rate risk exposure in existence at the balance date, with all other variables remaining constant: At balance date, had interest rates moved, as illustrated in the table below, post tax profit and equity would have been affected as follows: McConnell Dowell Annu l Review 69