NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED) 30 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES  (continued) (b) Risk exposures and responses  (continued) For the year ended 30 June 2014 Foreign currency risk  (continued) Credit risk Concentrations of credit risk: Liquidity Risk In addition, the Group uses forward currency contracts to eliminate the foreign currency exposure on part of the Group’s estimated foreign currency  payments, which are regularly updated to ensure a rolling forward cover position. It is the Group’s policy to negotiate the terms of the foreign currency derivatives to match the terms of the underlying foreign currency exposures as closely  as possible, to maximise the effectiveness of the derivatives. As at 30 June 2014 and 30 June 2013, the Group had hedged the majority (by value) of foreign  currency purchases that were firm commitments. The following sensitivity analysis is based on the foreign currency risk exposures in existence at  reporting date. A sensitivity of 10% has been selected as this is deemed to be reasonably possible given the current level of the United States Dollar and  other relevant exchange rates. At 30 June 2014 and 30 June 2013, if foreign exchange rates had moved as illustrated in the table below, with all other variables held constant, post tax  profit and equity would have been affected as follows: The movement in equity is due to an increase/decrease in the fair value of the derivative instruments, which are all designated as cash flow hedges.  The sensitivities for each year are impacted by the derivative balances and exchange rates. There is no movement in profit in this foreign exchange rate  sensitivity analysis due to the fact that movements in the unhedged foreign currency amounts only impact asset and liability balances. The Group’s exposure to price risk is minimal. The Group trades only with recognised, creditworthy third parties. It is the Group’s policy that all customers who wish to trade on credit terms are subject  to credit verification procedures. In addition, receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts  is not significant. Credit risk in trade receivables is managed in the following ways: The Group’s maximum exposure to credit risk at reporting date in relation to each class of recognised financial asset, other than derivatives, is the carrying  amount of those assets as recognised in the statement of financial position. In relation to derivative financial instruments, credit risk arises from the potential failure of counterparties to meet their obligations under the contract or  arrangement. However, the Group ensures that it only enters into contracts with creditworthy institutions, as set out in the relevant Group policy. The Group minimises concentrations of credit risk in relation to trade accounts receivable by undertaking transactions with a large number of customers  within the specified industries. The customers are mainly concentrated in Australia. Liquidity risk management is concerned with ensuring that there are sufficient funds available to meet the Group’s commitments in a timely manner. The  Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans, finance leases and  hire purchase contracts. Liquidity risk is measured by comparing projected net debt levels for the next 12 months against total committed facilities on a rolling monthly basis and  includes monthly cash flow forecasts from the Group’s operating divisions. Projected net debt levels take into account: The risk implied from the values shown in the following table reflects a balanced view of cash inflows and outflows. Leasing obligations, trade payables  and other financial liabilities mainly originate from the financing of assets used in ongoing operations such as property, plant and equipment and  investments in working capital. These assets are considered in the Group’s overall liquidity risk. To ensure that the maturity of funding facilities is not  concentrated in one period, the Group will generally ensure that no more than 30% of its committed facilities mature within any 12 month period. As at  30 June 2014, 5% (2013: 9%) of the Group’s debt will mature in less than one year. To monitor existing financial assets and liabilities as well as to enable an effective controlling of future risks, the Group has established comprehensive  risk reporting that reflects the expectations of management of settlement of financial assets and liabilities. The following table reflects all contractually fixed payables and receivables for settlement, repayments and interest resulting from recognised financial  assets and liabilities, including derivative financial instruments as at 30 June 2014. For derivative financial instruments and other obligations, the  contractual undiscounted cash flows for the respective upcoming fiscal years are presented. Cash flows for financial assets and liabilities without fixed  amount or timing are based on the conditions existing at 30 June 2014. – existing debt; – future operating and financing cash flows; – approved capital expenditure; – approved investment expenditure for new sites; and – dividend distributions and income tax payments. Commodity price risk – payment terms are generally 30 to 90 days; and – a risk assessment process is used for customers over $50,000. POST TAX PROFIT  HIGHER/(LOWER) EQUITY  HIGHER/(LOWER) Sensitivity analysis 2014  $’000 2013  $’000 2014  $’000 2013  $’000 CONSOLIDATED If foreign exchange rates were 10 per cent higher  with all other variables held constant – – (2,573) (2,487) If foreign exchange rates were 10 per cent lower  with all other variables held constant – – 3,145 3,040 68 VILLAGE ROADSHOW LIMITED CLOSE FILE X