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Botswana Institute of Chartered Accountants Annual Report Integrating skills and best practice into the next generation for Botswana’s Transformation Year 2019
Notes to the Annual Financial Statements (continued) for the year ended 31 December 2019 Exposure in Pula 28.
Financial instruments and risk management (continued) The amounts disclosed are the contractual undiscounted cash flows due within 12 months and are equal to their carrying balances as the impact of discounting is not significant.
2019 Non-current liabilities Lease liabilities 24 Current liabilities Trade and other payables 25 Lease liabilities 24
Less than 1 year -
4 446 475 113 600 4 560 075
1 to 2 Total years 278 553
278 553
278 553
4 446 475 113 600 4 838 628
2018 Less than Total 1 year Current liabilities Trade and other payables 25 3 469 473 3 469 473
Carrying amount 278 553
4 446 475 113 600 4 838 628
Carrying amount 3 469 473
Foreign exchange risk The Institute transacts with other International Professional Bodies and is exposed to foreign exchange risk arising from various currencies, primarily with respect to the Pound Sterling. Foreign exchange risk arises from investment and other commercial transactions. The Institute’s risk management objective is to manage foreign exchange risk related to foreign denominated cash flows. The Institute is exposed to currency risk related to changes in rates of exchange between the Pound Sterling and the Botswana Pula. A significant change in the currency exchange rate between the Pound Sterling and the Botswana Pula could have a material effect on the Institute’s surplus. There are no open forward cover contracts. The Institute is exposed to currency risk through trade receivables, trade payables and certain bank accounts denominated in Pound Sterling as shown below:
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BICA Annual Report 2019
The net carrying amounts, in Pula, of the various exposures, are denominated in the following currencies. The amounts have been presented in Pula by converting the foreign currency amounts at the closing rate at the reporting date: 2019 P
2018 P
930 436 3 278 533
1 037 563 2 866 710
(3 051 457) 1 157 512
(2 665 632) 1 238 641
Current assets: Trade and other receivables Cash and cash equivalents
69 695 245 581
78 014 215 547
Current liabilities: Trade and other payables Net GBP exposure
(228 572) 86 704
(200 428) 93 133
13.3501
13.2997
Current assets: Trade and other receivables Cash and cash equivalents
Current liabilities: Trade and other payables Net Pula exposure
Exposure in foreign currency amounts
The net carrying amounts, in foreign currency of the above exposure was as follows: GBP exposure:
Exchange rates
Pula per unit of foreign currency: GBP
Foreign currency sensitivity analysis The following information presents the sensitivity of the institute to an increase or decrease in the respective currencies it is exposed to. The sensitivity rate is the rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated amounts and adjusts their translation at the reporting date. No changes were made to the methods and assumptions used in the preparation of the sensitivity analysis compared to the previous reporting period. BICA Annual Report 2019
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