117 Cloudberry Annual report 2022 Financial statements Liquidity risk Liquidity risk is the risk that the Group will not be able to meet its financial obligations when due. The Group manages liquidity risk through, on a regular basis, to review future commitments and the liquidity reserves which consist of cash (see note 21) and borrowing facilities (see note 23). Management prepares minimum quarterly cash flow forecasts that look a minimum of 24 months ahead to handle the liquidity risk. When taking business decisions and entering into contracts the Group evaluates the liquidity needs and makes sure the liquidity needed is in place before entering into contracts. As of 31 December 2022, the Group has a total of approximately NOK 550 million in contractual commitments, in addition to the current payables which are recognised in the Groups balance sheet. The obligation does not include regular employee expenses or other day-to-day costs. See note 16 Property, plant and equipment and note 24 Provisions, guarantees and other contractual obligations. The following table shows the maturity for nominal cash outflow for the contractual obligations as per 31 December 2022: NOK million Carrying amount Less than a year 2024 2025 2026 2027+ Total Bank loan (incl. interest payments) 338 37 26 26 230 75 394 Lease liabilities 43 7 7 8 7 24 53 Accounts payable 135 135 - - - - 135 Total non-derivatives 516 179 34 33 237 99 582 Net-settled derivatives 25 17 8 - - - 25 Total financial liabilities and derivatives 540 196 41 33 237 99 607 Per 31 December 2021: NOK million Carrying amount Less than a year 2024 2025 2026 2027+ Total Bank loan (incl. interest payments) 304 20 21 21 21 313 396 Lease liabilities 5 1 1 1 - 2 6 Accounts payable 38 38 - - - - 38 Total non-derivatives 347 59 22 22 21 315 440 Net-settled derivatives 3 - - - - 1 3 Total financial liabilities and derivatives 350 60 23 23 22 316 443 Credit risk Credit risk is the risk that the Group’s customers or counterparties will cause financial loss by failing to honour their obligations. The Group is exposed to third party credit risk in several instances including off-take partners who have committed to buy electricity produced by or on behalf of the Group, banks providing financing and guarantees of the obligations of other parties, insurance companies providing coverage against various risks applicable to the Group’s assets, and other third parties who may have obligations towards the Group including warranties provided under share purchase agreements. The Group’s main credit risks arise from credit exposures with deposits with financial institutions and other short-term receivables. Counterparties in derivative contracts and financial deposits are limited to financial institutions with high creditworthiness. The Group’s account receivables have low credit risk and all receivables over the past several years have been collected in full and on time. At year end Management has evaluated the account receivables credit risk to be insignificant and the account receivables are therefore recognised in the financial statements at face value.
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