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Annual Report & Accounts 2012 - NOTES
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GVC HOLDINGS PLC NOTES TO THE FINANCIAL STATEMENTS 20.3 Interest Rate Risk The Group earns interest from bank deposits. During the year, the Group held cash on deposits with a range of maturities of less than three months. The Group had no committed borrowing facilities as at 31 December 2012 (2011: €nil). Management do not consider the impact of possible interest rate movements based on current market conditions to be material to the net result for the year or the equity position at the year end for either the year ended 31 December 2011 or 31 December 2012. 20.4 Credit Risk The Group has no significant concentrations of credit risk with exposure spread over a large number of customers. The Group does not grant credit facilities to any of its customers and the maximum exposure to credit risk is represented by the carrying amount of each financial asset in the balance sheet. The Group has material exposure to credit risk through amounts owed by payment processors (third party collection agencies) of €13.4 million (2011: €8.4 million) and cash balances held with banking institutions of €6.6 million (2011: €5.2 million). The Group considers the credit risk associated with these balances to be low, having assessed the credit ratings and financial strength of the counter-parties involved. The Group is seeking to diversify its banking deposits to further reduce credit risk. No provision for impairment has been made at 31 December 2012 (2011: €nil). No receivable amounts were past due date at 31 December 2012 (2011: €nil). 20.5 Liquidity Risk At 31 December 2012, the Group had cash and cash equivalents of €6.6 million (2011: €9.9 million) and considers liquidity risk to be low for the business. All financial liabilities at the year-end are due within one year, with the exception of the deferred consideration on Betboo. 20.6 Fair Values The carrying amounts of the financial assets and liabilities, including deferred consideration in the Balance Sheet at 31 December 2012 and 2011 for the Group and Company are a reasonable approximation of their fair values. All trade and other receivables and payables have a maturity of less than one year. 20.7 Summary of Financial Assets and Liabilities by Category The carrying amounts of the Group's financial assets and liabilities recognised at the balance sheet date are categorised as follows: 2012 2011 €000's €000's Current assets: Financial assets measured as loans and receivables: - Trade and Other receivables 15,386 7,511 - Cash and cash equivalents 6,632 9,853 Current liabilities: Financial liabilities measured at amortised cost: - Trade and other payables 18,982 15,926 - Deferred consideration 12,283 12,940 51