b'NoTes To The FiNaNCiaL sTaTemeNTsFOR THE yEAR ENDED 30 JUNE 2021 Financial assets (continued)the liability, consideration is given to employee wage increases and the Impairment of financial assets probability that the employees may not satisfy vesting requirements.Those Impairment of financial assets is recognised on an expected credit loss (ECL)cash flows are discounted using market yields on corporate bonds with basis for the following assets: terms to maturity that match the expected timing of cash flows.financial assets measured at amortised cost (g) ProvisionsProvisionsarerecognisedwhentheClubhasalegalorconstructive Under AASB 9 Financial Instruments, an expected credit loss model is appliedobligation, as a result of past events, for which it is probable that an outflow in measuring impairment losses on financial assets. To reflect changes inof economic benefits will result and that outflow can be reliably measured.credit risk this expected credit loss model requires the Club to account forProvisions are measured using the best estimate of the amounts required to expected credit losses since initial recognition. If the credit risk on a financialsettle the obligation at reporting date.instrument has not shown significant change since initial recognition, an(h) Cash and Cash Equivalentsexpected credit loss amount equal to the 12-month expected credit loss isCash and cash equivalents include cash on hand, deposits held at call with used. However, a loss allowance is recognised at an amount equal to thebanks, other short-term highly liquid investments with original maturities of lifetime expected credit loss if the credit risk on that financial instrument hasthree months or less, and bank overdrafts. Bank overdrafts are shown within increased significantly since initial recognition. short-term borrowings in current liabilities on the statement of financial position.When determining whether the credit risk of a financial asset has increased(i) Revenue RecognitionsignificantsinceinitialrecognitionandwhenestimatingECL,TheClubRevenue from contracts with customers considersreasonableandsupportableinformationthatisrelevantand available. This includes both quantitative and qualitative information andThe core principle of AASB 15 is that revenue is recognised on a basis analysisbasedontheClubshistoricalexperienceandinformedcreditthat reflects the transfer of promised goods or services to customers at assessment and including forward looking information. an amount that reflects the consideration the Club expects to receive in The Club uses the presumption that an asset which is more than 90 daysexchange for those goods or services.Revenue is recognised by applying a past due has seen a significant increase in credit risk. five-step model as follows:The Club uses the presumption that a financial asset is in default when: 1. Identify the contract with the customer;the other party is unlikely to pay its credit obligations to the Club in full,2. Identify the performance obligations;without recourse to the Club to actions such as realising security (if any3. Determine the transaction price;is held); or 4. Allocate the transaction price to the performance obligations; andthe financial asset is more than 90 days past due. 5. Recognise revenue as the performance obligations are satisfied. Credit losses are measured as the present value of the difference betweenAccommodation revenuethe cash flows due to the Club in accordance with the contract and the cashAccommodation revenue is recognised at the point in time services are flows expected to be received. This is applied using a probability weightedprovided to the guest.approach. On derecognition of a financial asset measured at amortisedRoom hire revenuecost, the difference between the assets carrying amount and the sum of the consideration received and receivable is recognised in profit or loss. Other room hire is recognised at the time service is provided to the hirer.Trade receivables (and contract assets) Food and beverage salesImpairment of trade receivables and contract assets have been determinedFood and beverage sales are recognised at the time the goods are delivered usingthesimplifiedapproachinAASB9whichusesanestimationofto the customer, being the point of sale. Income received in advance of the lifetime expected credit losses. The Club has determined the probability ofdate of food and beverage consumption is deferred.non-payment of the receivable and contract asset and multiplied this by theMembership subscription revenueamount of the expected loss arising from default. Membership income is recognised over time, through the period to which The amount of the impairment is recorded in a separate allowance accountthemembershiprenewalrelates.Anymembershipsubscriptionrevenue with the loss being recognised in the statement of profit or loss. Once therelating to periods beyond the current financial year is carried forward in the receivable is determined to be uncollectable then the gross carrying amountStatement of Financial Position as income received in advance.is written off against the associated allowance. Lease incomeOther financial assets measured at amortised cost Lease income from the tenanted shop is recognised on a straight line basis Impairmentofotherfinancialassetsmeasuredatamortisedcostareover the term of the lease.determinedusingtheexpectedcreditlossmodelinAASB9.OninitialInterest revenuerecognition of the asset, an estimate of the expected credit losses for the next 12 months is recognised. Where the asset has experienced significantInterest revenue is recognised using the effective interest rate method.increase in credit risk then the lifetime losses are estimated and recognised. Dividend incomeFinancial liabilities Dividend revenue is recognised when the right to receive a dividend has been The Club measures all financial liabilities initially at fair value less transactionestablished.costs, subsequently financial liabilities are measured at amortised cost usingGovernment grantsJobkeeper subsidythe effective interest rate method. Government grants relating to costs are deferred and recognised in profit The financial liabilities of the Club comprise trade and other payables. or loss over the period necessary to match them with the costs that they (e) Impairment of Assets are intended to compensate. Government grants have been presented on At the end of each reporting period, the Club assesses whether there is anya gross basis in the statement of profit or loss and other comprehensive indication that an asset has been impaired.If such an indication exists, anincome. impairment test is carried out on the asset by comparing the recoverable(j) Goods and Services Tax (GST)amount of the asset, being the higher of the assets fair value less costs to sellRevenues, expenses and assets are recognised net of the amount of GST, and value in use to the assets carrying value. Any excess of the assets carryingexceptwheretheamountofGSTincurredisnotrecoverablefromthe value over its recoverable amount is expensed to the profit and loss account. Australian Taxation Office. In these circumstances, the GST is recognised Where it is not possible to estimate the recoverable amount of an individualas part of the cost of acquisition of the asset or as part of an item of the asset, the Club estimates the recoverable amount of the cash-generating unitexpense.Receivables and payables in the statement of financial position to which the asset belongs. are shown inclusive of GST.(f) Employee Benefits Cash flows are presented in the statement of cash flows on a gross basis, Provision is made for the Clubs liability for employee benefits arising fromexcept for the GST component of investing and financing activities, which are services rendered by employees to balance date. Employee benefits thatdisclosed as operating cash flows.are expected to be settled within one year have been measured at the(k) Comparative Figuresamounts expected to be paid when the liability is settled. Employee benefitsWhere required by Accounting Standards, comparative figures have been payable later than one year have been measured at the present value of theadjusted to conform to changes in presentation for the current financial year.estimated future cash outflows to be made for those benefits. In determining October 2021 NSW Masonic Club15'