(E) FOREIGN CURRENCY TRANSLATION (i) Functional and presentation currency Both the functional and presentation currency of the Company and its Australian subsidiaries is Australian dollars (A$). (ii) Transactions and balances Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange  rates ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are  translated at the rate of exchange at the reporting date. All exchange differences in the consolidated financial report are taken to the statement of comprehensive income. (F) OPERATING SEGMENTS An operating segment is a component of an entity that engages in business activities from which it may earn  revenues and incur expenses (including revenues and expenses relating to transactions with other components  of the same entity), whose operating results are regularly reviewed by the entity’s chief operating decision maker  to make decisions about resources to be allocated to the segment and assess its performance and for which  discrete financial information is available. This includes start up operations which are yet to earn revenues.  Management will also consider other factors in determining operating segments such as the existence of a line  manager and the level of segment information presented to the board of directors. Operating segments have been identified based on the information provided to the chief operating decision  makers – being the executive management team. The Consolidated Entity aggregates two or more operating segments when they have similar economic  characteristics. Operating segments that meet the quantitative criteria as prescribed by AASB 8 are reported separately. However,  an operating segment that does not meet the quantitative criteria is still reported separately where information  about the segment would be useful to users of the financial statements. Information about other business activities and operating segments that are below the quantitative criteria are  combined and disclosed in a separate category for “all other segments”. (G) CASH AND CASH EQUIVALENTS Cash and cash equivalents in the statement of financial position comprise cash at bank and in hand and short- term deposits that are readily convertible to known amounts of cash and which are subject to an insignificant risk  of changes in value. For the purposes of the Statement of cash flows, cash and cash equivalents consist of cash and cash equivalents  as defined above, net of outstanding bank overdrafts. Bank overdrafts are included within interest bearing loans  and borrowings in the current liabilities on the statement of financial position. (H) TRADE AND OTHER RECEIVABLES Trade and other receivables, which generally have 30-60 day terms, are recognised initially at fair value and  subsequently measured at amortised cost using the effective interest rate method, less an allowance for impairment.  Collectibility of trade and other receivables is reviewed on an ongoing basis. Individual debts that are known to  be uncollectible are written off when identified. An impairment allowance is recognised when there is objective  evidence that the Consolidated Entity will not be able to collect the receivable. Financial difficulties of the debtor,  default payments or debts more than 60 days overdue are considered objective evidence of impairment. The  amount of the impairment loss is the receivable carrying amount compared to the present value of estimated  future cash flows, discounted at the original effective interest rate. 60  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2011