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QUEENSLAND ART GALLERY ANNUAL REPORT 2007–08
APPENDIXES
94
(c) Liquidity Risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. This risk is controlled through the
Gallery's investment in financial instruments, which under normal market conditions are readily convertible to cash.
The Gallery is exposed to liquidity risk in respect of its payables.
The Gallery also manages exposure to liquidity risk by ensuring that sufficient funds are held to meet supplier obligations as they fall due. This is achieved by
ensuring that minimum levels of cash are held within the various bank accounts so as to match the expected duration of the various supplier liabilities.
The following table sets out the liquidity risk of financial liabilities held by the Gallery. It represents the contractual maturity of financial liabilities, calculated
based on cash flows relating to the repayment of the principal amount outstanding at balance date.
2008 Payable in
Note
< 1 year
1 - 5 years
> 5 years
Total
$'000
$'000
$'000
$'000
Financial Liabilites
Payables
15
1061
-
-
1061
Total
1061
-
-
1061
2007 Payable in
Note
< 1 year
1 - 5 years
> 5 years
Total
$'000
$'000
$'000
$'000
Financial Liabilites
Payables
15
1873
-
-
1873
Total
1873
-
-
1873
(d) Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Gallery's income or the value
of its holdings of financial instruments. The Foundation's Investment sub-committee actively monitor investments to ensure overall exposure of the portfolio is
within acceptable levels.
In respect of the managed funds and shares, the Gallery is subject to domestic and international equities market fluctuations. While the Gallery does not trade
in foreign currency, it is indirectly exposed to movements in foreign exchange rates through its funds held in the international market.
The Gallery is exposed to interest rate risk through its cash deposited in interest bearing accounts and managed fund investments. The Gallery does not
undertake any hedging in relation to interest rate risk.