6.2.2. Receivables
Accounting policies
Receivables include chiefly current trade receivables (mainly in connection with sale of gas fuel), taxes, customs duties and social security.
Current trade receivables are initially recognised at fair value, equal to their nominal value. Following initial recognition, receivables are measured at amortised cost, taking into account impairment losses, if any.
Taxes, customs duties and social security receivable by the Group are determined in accordance with applicable laws and regulations.
Material estimates
The amount of impairment loss on receivables equals the difference between the carrying amount of an asset and the present value of estimated future cash flows discounted at the asset’s original effective interest rate.
Depending on the type of receivables, impairment losses are determined using the statistical or individual method.
The Group recognises impairment losses on receivables using the individual method if the receivable is past due by more than 90 days or if the receivable is at risk (e.g. the debtor has filed for bankruptcy). Impairment loss is recognised for 100% of the amount of such a receivable.
Impairment losses on receivables for gas deliveries to customers from tariff groups 1−4 (chiefly retail customers and SMEs) are determined using the statistical method. The impairment losses are determined based on the analysis of historical data on payment of past due receivables in particular maturity groups. The results of the analysis are then used to calculate recovery ratios on the basis of which the amounts of impairment losses on receivables in each ageing group are determined.
Impairment losses are charged to other expenses or finance costs, as appropriate, depending on the type of receivables for which an impairment loss is recognised.
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| Receivables | 2016 | 2015 | ||||
|---|---|---|---|---|---|---|
| Gross carrying amount | Impairment losses | Net carrying amount | Gross carrying amount | Impairment losses | Net carrying amount | |
| Trade receivables (mainly in connection with sale of gas fuel) | 3,834 | (318) | 3,516 | 2,899 | (358) | 2,541 |
| VAT receivable | 375 | (1) | 374 | 431 | – | 431 |
| Corporate income tax receivable | 39 | (1) | 38 | 7 | – | 7 |
| Other taxes, customs duties and social security receivable | 28 | (6) | 22 | 150 | (3) | 147 |
| Other receivables | 784 | (446) | 338 | 682 | (429) | 253 |
| Total, including: | 5,060 | (772) | 4,288 | 4,169 | (790) | 3,379 |
| not past due | 3,848 | (4) | 3,844 | 2,940 | (44) | 2,896 |
| past due and impaired | 768 | (768) | – | 746 | (746) | – |
| past due but unimpaired | 444 | – | 444 | 483 | – | 483 |
Ageing structure of trade receivables past due but unimpaired:
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| Delay | 2016 | 2015 |
|---|---|---|
| Up to 1 month | 290 | 328 |
| From 1 to 3 months | 60 | 59 |
| From 3 months to 1 year | 53 | 14 |
| from 1 to 5 years | 9 | 17 |
| over 5 years | 2 | – |
| Total net past due receivables | 414 | 418 |
Trade receivables are the source of the Group’s credit and currency risk exposure. For information on credit risk management (including assessment of the credit quality of receivables and credit risk concentration), see Note 7.3.1. For information on currency risk related to receivables, see Note 7.3.2.2.
