Red Bubble Annual Report 2022

10. Financial risk management continued (c) Liquidity risk Prudent liquidity risk management implies maintaining sufficient cash in accordance with forecast cash usage. Due to the dynamic nature of the underlying business, flexibility in funding is maintained by ensuring ready access to the cash reserves of the business. All financial liabilities (excluding lease liabilities) are current and anticipated to be repaid over the normal payment terms, usually 30 days. Financial arrangements The Group had no borrowing facilities at the end of reporting period nor at the end of the prior reporting period. Maturities of financial liabilities Financial liabilities owed by the Group at 30 June 2022 are $65.9 million (2021: $50 million). These items are based on contractual undiscounted payments. The table below summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments: Year ended 30 June 2022 Trade and other payables(1) $’000 Lease liabilities $’000 Total $’000 1 to 3 months 55,867 908 56,775 3 to 12 months – 2,528 2,528 1 to 3 years – 4,918 4,918 > 3 years – 1,663 1,663 Total 55,867 10,017 65,884 (1) Excludes sales taxes. Year ended 30 June 2021 Trade and other payables(1) $’000 Lease liabilities $’000 Total $’000 1 to 3 months 43,585 840 44,425 3 to 12 months – 1,751 1,751 1 to 3 years – 3,097 3,097 > 3 years – 745 745 Total 43,585 6,433 50,018 (1) Excludes sales taxes. (d) Capital management The Group’s policy is to maintain a capital structure for the business which ensures sufficient liquidity, provides support for business operations, maintains shareholder confidence and positions the business for future growth. The Group manages its capital structure and makes adjustments in light of changes in economic conditions. The ongoing maintenance of the Group’s policy is characterised by ongoing cash flow forecast analysis and detailed budgeting which is directed at providing a sound financial positioning for the Group’s operations and financial management activities. The Group is not subject to externally imposed capital requirements. Notes to the Consolidated Financial Statements continued For the Year Ended 30 June 2022 11. Other assets Current Non-current Consolidated 2022 $’000 2021 $’000 2022 $’000 2021 $’000 Security bonds 350 962 677 723 Goods in transit(1) 4,420 3,731 – – Total other assets 4,770 4,693 677 723 (1) Goods in transit represents the cost of goods that have been manufactured but are in transit to customers. 12. Property, plant and equipment Plant and equipment is measured on a cost basis and carried at cost less accumulated depreciation and any accumulated impairment losses. Depreciation The depreciable amount of all fixed assets is depreciated on a straight-line basis over the asset’s useful life to the Group commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements. The depreciation rates used for each class of depreciable asset are shown below: Class of Fixed Assets Useful life Leasehold improvements Life of the applicable lease Computer equipment 3 years Furniture and equipment 2-5 years At the end of each annual reporting period, the depreciation method, useful life and residual value of each asset is reviewed. Any revisions are accounted for prospectively as a change in estimate. 73 Redbubble – Annual Report 2022 72 Redbubble – Annual Report 2022