Annual Report & Accounts 2026
58
FINANCIAL INSTRUMENTS
The Group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a financial liability or an equity instrument in accordance with the substance of the underlying contractual arrangement. Financial instruments are recognised on the date when the Group becomes party to the contractual provisions of the instrument. Financial instruments are initially recognised at fair value. Financial instruments cease to be recognised at the date when the Group ceases to be party to the contractual provisions of the instrument.
Financial assets are included on the statement of financial position as investments in subsidiaries, trade and other receivables, other assets, or cash and cash equivalents.
a. Trade and other receivables Trade and other receivables are stated at their original invoiced value, as the interest that would be recognised from discounting the future cash receipts over the short credit period is not considered to be material. Trade receivables are amounts due from clients for services performed in the ordinary course of business. Trade receivables are initially recognised at the amount of consideration and subsequently at amortised cost, less expected credit losses.
The expected credit losses are measured by applying an expected loss rate to the gross carrying amount. The expected loss rate comprises the risk of a default occurring and the expected cash flows given default, based on the ageing of the receivable together with other specific circumstances, both present and or future, of which the Group is aware, which is likely to affect the likely recoverability of the receivable. b. Other assets
Other financial assets comprise the minority investment held in Keypoint Law Pty Limited. This un-listed investment is included in non-current assets and, as management does not intend to dispose of it within twelve months of the end of the reporting period, is held at the directors’ estimate of fair value.
c. Trade and other payables
Trade and other payables are stated at their original invoiced value, as the interest that would be recognised from discounting the future cash payments over the short credit period is not considered to be material.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the Company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash on hand and call deposits, and other short-
term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.
PROVISIONS
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, when it is probable that the Group will be required to settle that obligation, and when a reliable estimate can be made of the amount of the obligation.
Provisions are measured at the Directors’ best estimate of the expenditure required to settle the obligation at the reporting date and are discounted to present value where the effect is material. Where a provision is made in respect of a professional negligence claim, which is covered by the Group’s professional indemnity insurance, the amount provided would be the amount payable by the Group whether due to the policy excess or otherwise, with a corresponding asset (the reimbursement asset within trade and other NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2. ACCOUNTING POLICIES CONTINUED
FINANCIAL INSTRUMENTS
The Group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a financial liability or an equity instrument in accordance with the substance of the underlying contractual arrangement. Financial instruments are recognised on the date when the Group becomes party to the contractual provisions of the instrument. Financial instruments are initially recognised at fair value. Financial instruments cease to be recognised at the date when the Group ceases to be party to the contractual provisions of the instrument.
Financial assets are included on the statement of financial position as investments in subsidiaries, trade and other receivables, other assets, or cash and cash equivalents.
a. Trade and other receivables Trade and other receivables are stated at their original invoiced value, as the interest that would be recognised from discounting the future cash receipts over the short credit period is not considered to be material. Trade receivables are amounts due from clients for services performed in the ordinary course of business. Trade receivables are initially recognised at the amount of consideration and subsequently at amortised cost, less expected credit losses.
The expected credit losses are measured by applying an expected loss rate to the gross carrying amount. The expected loss rate comprises the risk of a default occurring and the expected cash flows given default, based on the ageing of the receivable together with other specific circumstances, both present and or future, of which the Group is aware, which is likely to affect the likely recoverability of the receivable. b. Other assets
Other financial assets comprise the minority investment held in Keypoint Law Pty Limited. This un-listed investment is included in non-current assets and, as management does not intend to dispose of it within twelve months of the end of the reporting period, is held at the directors’ estimate of fair value.
c. Trade and other payables
Trade and other payables are stated at their original invoiced value, as the interest that would be recognised from discounting the future cash payments over the short credit period is not considered to be material.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the Company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash on hand and call deposits, and other short-
term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.
PROVISIONS
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, when it is probable that the Group will be required to settle that obligation, and when a reliable estimate can be made of the amount of the obligation.
Provisions are measured at the Directors’ best estimate of the expenditure required to settle the obligation at the reporting date and are discounted to present value where the effect is material. Where a provision is made in respect of a professional negligence claim, which is covered by the Group’s professional indemnity insurance, the amount provided would be the amount payable by the Group whether due to the policy excess or otherwise, with a corresponding asset (the reimbursement asset within trade and other NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2. ACCOUNTING POLICIES CONTINUED