Mandarin Oriental International Limited - Mandarin Oriental Hotel ...
Mandarin Oriental International Limited - Mandarin Oriental Hotel ...
Mandarin Oriental International Limited - Mandarin Oriental Hotel ...
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Notes to the Financial Statements Continued<br />
14 Debtors and prepayments continued<br />
The average credit period on provision of services varies among Group businesses and is not more than 30 days.<br />
Before accepting any new customer, individual Group business assesses the potential customer’s credit quality and sets<br />
credit limits by customer, using internal credit scoring systems. These limits and scoring are reviewed periodically.<br />
An allowance for impairment of trade debtors is made based on the estimated irrecoverable amount. Significant<br />
financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganization, and<br />
default or delinquency in payment are considered indicators that the debtor is impaired.<br />
At 31st December 2008, trade debtors of US$1.7 million (2007: US$1.0 million) were impaired. The amount of<br />
the provision was US$1.2 million (2007: US$0.6 million). It was assessed that a portion of the debtors would be<br />
recoverable. The ageing analysis of these trade debtors is as follows :<br />
60 <strong>Mandarin</strong> <strong>Oriental</strong> <strong>International</strong> <strong>Limited</strong><br />
2008 2007<br />
US$m US$m<br />
Below 30 days 0.2 0.2<br />
Between 31 and 60 days 0.3 0.1<br />
Between 61 and 90 days 0.1 0.1<br />
Over 90 days 1.1 0.6<br />
1.7 1.0<br />
At 31st December 2008, trade debtors and other debtors of US$13.8 million (2007: US$12.4 million) were past due<br />
but not impaired. The ageing analysis of these trade debtors and other debtors is as follows :<br />
Below 30 days 6.7 6.7<br />
Between 31 and 60 days 1.4 3.0<br />
Between 61 and 90 days 2.1 1.3<br />
Over 90 days 3.6 1.4<br />
13.8 12.4<br />
The risk of trade debtors and other debtors that are neither past due nor impaired at 31st December 2008 becoming<br />
impaired is low as the majority of the balances have been settled subsequent to year end.<br />
Movements on the provision for impairment are as follows:<br />
Trade debtors<br />
2008 2007<br />
US$m US$m<br />
At 1st January (0.6 ) (1.2 )<br />
Additional provisions (0.6 ) –<br />
Unused amounts reversed – 0.5<br />
Bad debts written off – 0.1<br />
At 31st December (1.2 ) (0.6 )