Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698078440977.pdf (Seychelles)
SEYCHELLES CIVIL AVIATION AUTHORITY TABLE OF CONTENTS - DECEMBER 31, 2022 CONTENTS General Information Directors' Report Auditor General's Report Statement of Financial Position Statement of Profit or Loss and Other Comprehensive Income Statement of Changes in Equity Statement of Cash Flows PAGES 1 2 - 3 4 - 4(b) 5 6 7 8 Notes to the Financial Statements 9 - 35 SEYCHELLES CIVIL AVIATION AUTHORITY GENERAL INFORMATION 1 DIRECTORS : SECRETARY REGISTERED OFFICE PRINCIPAL PLACE OF BUSINESS AUDITORS BANKERS : : : : : Appointed Effective February 2021 Marlon Orr Sherin Francis Kelly Naidoo Yannick Roucou Magalie Essack Appointed effective July, 2022 Noella Vinda Pedro Pierre Resigned Garry Jupiter - April 2022 May-Paul Marengo - June 2022 Ms. Audrey Nanon Seychelles Pension Fund Victoria, Mahé Seychelles P.O.
Box 181, Seychelles International Airport Pointe Larue, Mahé, Seychelles Seychelles International Airport Pointe Larue, Mahé, Seychelles Office of the Auditor General 3rd Floor, Block C, Unity House Victoria, Seychelles Seychelles International Mercantile Banking Corporation Limited The Mauritius Commercial Bank (Seychelles) Limited Absa Bank Seychelles Limited Seychelles Commercial Bank Bank of Baroda Seychelles SEYCHELLES CIVIL AVIATION AUTHORITY DIRECTORS' REPORT 2 The Board of Directors present their report together with the Auditor’s Report and the Audited Financial Statements of the Seychelles Civil Aviation Authority (SCAA) (hereafter called the “Authority”) for the year ended December 31, 2022.
PRINCIPAL ACTIVITIES The principal activities of the Authority are the provision of Aviation Regulatory and Safety Oversight, the provision of Air Navigation Services, the provision of Aviation Security Services and Management and provision of Operational Services at Seychelles International and Praslin Airports.

It also facilitates business development opportunities.

There has been no significant change in the nature of these activities during the year under review.
RESULTS FOR THE YEAR Profit/(Loss) for the year Retained earnings brought forward Accumulated profit available for distribution Dividends paid Retained earnings carried forward DIVIDENDS 2022 SCR 2021 SCR 102,254,262 413,928,124 516,182,386 (15,000,000) 501,182,386 (42,192,728) 456,120,852 413,928,124 - 413,928,124 Dividends of SCR 15,000,000 has been declared and paid during the year under review (2021: Nil).
FIXED ASSETS The Fixed Assets of the Authority and the movements therein are detailed in Notes 5 and 6 to the financial statements.

The Directors are of the opinion that the carrying amount of fixed assets at the reporting date approximate their fair value.

DIRECTORS AND DIRECTORS' INTERESTS The Directors are appointed every three years in accordance with the Public Enterprise Monitoring Commission Act, 2013.
The Directors of the Authority since the date of the last report and the date of this report are: Appointed Effective February 2021 Resigned April and June 2022 Respectively Garry Jupiter May-Paul Marengo Marlon Orr (Chairman) Sherin Francis Magalie Essack Kelly Naidoo Yannick Roucou Appointed Effective July, 2022 Noella Vinda Pedro Pierre SEYCHELLES CIVIL AVIATION AUTHORITY DIRECTORS' REPORT (CONT'D) STATEMENT OF BOARD OF DIRECTOR’S RESPONSIBILITIES 3 The Board of Directors is responsible for the preparation and fair presentation of these financial statements in accordance with generally accepted accounting practice in Seychelles and for such internal control as Management determines is necessary to enable the preparation of financial statements that gives a true and fair view of the financial affairs of the Authority and are free from material misstatement, whether due to fraud or error.
In discharging this responsibility, the Board is further responsible to ensure the integrity of financial information; provides financial oversight and monitors financial planning and financial reports, including adoption and supervision of the annual budget; the Directors are to exercise their business judgement to act in what they reasonably believe to be the best interests of the entity in the administration of the entity’s assets, and where applicable, its investments.
The Board of Directors discusses issues confronting the Authority related to financial and operational risks and exposures associated with the entity’s business strategy, policy matters, service/product innovation and revenue road map (where applicable), are mindful of litigation and regulatory exposures, and other current matters that may present material risk to the entity’s financial performance, operations, infrastructure, plans, prospects or reputation, and acquisitions, as well as any issues of concern to the Board.
It is the duty of the Board of Directors to oversee Management’s performance to ensure that the entity operates in an effective, efficient and ethical manner in order to produce value for its clients and shareholders, in so doing, sees to the establishment of appropriate internal procedures and controls.

They are responsible for safeguarding the assets of the Authority and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Board of Directors consider that they have met their responsibilities as set out in the Public Enterprise Monitoring Commission Act, 2013 and the Seychelles Civil Aviation Authority Act 2005.

AUDITORS The Auditor General is the statutory Auditor of the Authority, in accordance with Section 12(3) of the Seychelles Civil Aviation Act, 2005.
BOARD APPROVAL Marlon Orr Director & Chairman Garry Albert Chief Executive Officer Director Sherin Francis Magalie Essack Director Kelly Chetty Director Yannick Roucou Director Noella Vinda Director Pedro Pierre Director Dated: May 29, 2023 Victoria, Seychelles SEYCHELLES CIVIL AVIATION AUTHORITY 4 Auditors REPORT SEYCHELLES CIVIL AVIATION AUTHORITY 4(a) Auditors REPORT SEYCHELLES CIVIL AVIATION AUTHORITY 4(b) Auditors REPORT SEYCHELLES CIVIL AVIATION AUTHORITY 4(c) Auditors REPORT SEYCHELLES CIVIL AVIATION AUTHORITY STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2022 Assets Non-Current Assets Property, Plant & Equipment Investment Property Capital Work in Progress Deferred Tax Asset Current Assets Inventories Trade and Other Receivables Current Tax Receivables Cash and Bank Balances Total Assets Reserves and Liabilities Reserves Capital Reserve Retained Earnings Liabilities Non-Current Liabilities Borrowings Gratuity and Compensation Deferred Tax Liabilities Current Liabilities Borrowings Gratuity and Compensation Accrued Leave Trades & Other Payables Total Equity & Liabilities Notes 5 6 7 8(b) 9 10 11(a) 12 13 14 15(a) 8(b) 14 15(a) 15(b) 16 5 2021 SCR 2022 SCR 323,107,135 49,134,691 92,218,886 - - 22,004,168 13,274,949 11,864,285 10,066,121 40,475,090 90,485,982 75,680,445 815,290,193 696,520,700 The financial statements have been approved for issue by the Board of Directors on: May 29, 2023 Marlon Orr Director & Chairman Garry Albert Chief Executive Officer Sherin Francis Director Magalie Essack Director Pedro Pierre Director Kelly Naidoo Director Yannick Roucou Director Noella Vinda Director The notes on pages 9 to 35 form an
 integral part of these financial statements Auditor General's report on pages 4 to 4(b) SEYCHELLES CIVIL AVIATION AUTHORITY STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 6 FOR THE YEAR ENDED DECEMBER 31, 2022 Aeronautical Revenue Non-Aeronautical Revenue Other Income Less IATA charges Operating Income Employment Benefits Costs Other Operating Overheads Exchange Movements Notes 2022 SCR 2021 SCR 17 425,188,239 256,424,777 48,214,152 35,659,247 845,617 1,258,825 (5,107,334) (2,521,098) 469,140,675 290,821,751 (215,557,390) (195,335,503) (78,209,561) (62,208,574) (3,213,407) (33,945,721) Earnings Before Depreciation, Interest, ECL & Tax 172,160,317 (668,047) Depreciation Charges Expected Credit Loss (ECL) Finance Income Finance Costs Profit/(Loss) Before Taxation Taxation 5 & 6 (38,043,744) (40,629,952) 10(b)(iii) 2,466,954 (3,918,466) 22 2,469,843 3,852,974 14(a) (2,739,658) (1,477,581) 136,313,712 (42,841,072) 11(b) (34,059,450) 648,344 Profit/(Loss) for the Year and Total Comprehensive Income/(Expense) 102,254,262 (42,192,728) The notes on pages 9 to 35 form an integral part of these financial statements Auditor General's report on pages 4 to 4(b) SEYCHELLES CIVIL AVIATION AUTHORITY STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED DECEMBER 31, 2022 7 Total SCR Capital Reserve SCR Retained Earning SCR At January 1, 2022 184,907,963 413,928,124 598,836,087 Total comprehensive income for the year Dividend paid - - 102,254,262 102,254,262 (15,000,000) (15,000,000) At December 31, 2022 184,907,963 501,182,386 686,090,349 At January 1, 2021 184,907,963 456,120,852 641,028,815 Total comprehensive expense for the year - (42,192,728) (42,192,728) At December 31, 2021 184,907,963 413,928,124 598,836,087 The notes on pages 9 to 35 form an integral part of these financial statements Auditor General's report on pages 4 to 4(b) SEYCHELLES CIVIL AVIATION AUTHORITY STATEMENT OF CASH FLOWS YEAR ENDED DECEMBER 31, 2022 Cash Flows from Operating
 Activities Profit/(Loss) Before Taxation Adjustments 8 Notes 2022 SCR 2021 SCR 136,313,712 (42,841,072) Depreciation Property and Equipment Profit from Disposal Property and Equipment 5 & 6 18 38,043,744 40,629,952 (388,218) (170,583) Provision for Expected Credit Losses 10(b)(iii) (2,466,954) 3,918,466 Leave Accrued Gratuity and Compensation Charged Interest Receivable/Payable Unrealised Exchange difference on Cash and Bank Balances Movements in Working Capital (Increase)/Decrease in Inventories (Increase) /Decrease in Trade & Other Receivable Increase/(Decrease) in Trade & Other Payable Net Cash Generated from Operation Net Tax Received/(Paid) Gratuity and Compensation Paid Net Cash Outflow from Operating Activities Cash Flows from Investing Activities Addition to Property & Equipment Addition to Work In Progress Proceed from Disposal Interest Received Addition to Fixed Deposit Cash Flows from Financing Activities Loan Receipts/Repayment Exchange Movement on Borrowings Dividend Paid Net Increase/Decrease in Cash & Equivalent Movement in Cash and Cash equivalents January 1, Increase Exchange difference on Cash and Bank Balances Cash as at December 31, 19 15(a) 22 11(a) 15(a) 5 7 14 14 24 21 12 The notes on pages 9 to 35 form an integral part of these financial statements Auditor General's report on pages 4 to 4(b) 1,127,722 9,221,455 (2,469,843) 328,700 13,795,177 - 4,653,209 29,101,100 184,034,828 44,761,740 (1,302,384) (656) (24,084,734) (26,700,205) 15,126,549 1,573,220 173,774,259 19,634,099 (8,340,750) 13,381,909 (11,864,285) (12,626,866) 153,569,223 20,389,142 (12,108,193) (4,018,593) (67,299,982) (36,570,822) 433,113 2,717,816 755,342 - (2,652,428) (4,317,243) (78,909,674) (44,151,316) 18,809,647 33,349,176 (2,249,825) (2,772,696) (15,000,000) - 1,559,823 30,576,480 76,219,371 6,814,306 76,210,466 98,497,260 76,219,371 6,814,306 (4,653,209) (29,101,100) 147,776,628 76,210,466 SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED
 DECEMBER 31, 2022 1.
GENERAL INFORMATION 9 The Seychelles Civil Aviation Authority (the Authority) was set up under the Seychelles Civil Aviation Authority Act, 2005 which came into force in April 2005.

The Authority was vested with the assets and liabilities of the former Directorate of Civil Aviation at nil consideration.

The Authority is domiciled in Seychelles and its registered office is at Seychelles International Airport, Anse des Genets, Mahé.
The activities of the Authority are regulatory, with respect to regulation of civil aviation activities and safety oversight, as well as service provider in the provision of air navigation services and management of Seychelles International and Praslin Airports.

2.

SIGNIFICANT ACCOUNTING POLICIES The principal accounting policies adopted in the preparation of these financial statements are set out below.
2.1 Basis of preparation The financial statements of the Authority have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standard Board (IASB) and in compliance with the requirements of the Public Enterprise Monitoring Commission Act, 2013.
These financial statements have been prepared under the historical cost convention as modified by the application of fair value measurements required or allowed by relevant accounting standards.

Where necessary, comparative figures have been amended to conform with changes in presentation in the current The Financial Statements are presented in Seychelles Rupees (SCR), which is also the Authority's functional currency.
The preparation of financial statements requires the use of certain critical accounting estimates.

It also requires Management to exercise judgement in the process of applying the Authority's accounting policies.

The areas involving higher degree of judgement and complexity or areas where assumptions are significant to the financial statements are disclosed in note 3.
2.2 New and amended standards and interpretations (a) New standards and amendments effective for annual periods beginning January 1, 2022 The following amendments to various International Financial Reporting Standards (IFRS)are mandatorily effective for reporting periods beginning on or after January 1, 2022: • Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS 37); • Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16); • Annual Improvements to IFRS 2018-2020 (Amendments to IFRS 1, IFRS 9, IFRS 16 and IAS 41); and • References to Conceptual Framework (Amendments to IFRS 3).
SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.
SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.2 New and amended standards and interpretations (Cont'd) 10 (a) New standards and amendments effective for annual periods beginning January 1, 2022 (Cont'd) i) Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS 37) IAS 37 defines an onerous contract as a contract in which the unavoidable costs (costs that the Authority has committed pursuant to the contract) of meeting the obligations under the contract exceed the economic benefits expected to be received under it.
The amendments to IAS 37.68A clarify that the costs relating directly to the contract consist of both: • The incremental costs of fulfilling that contract - e.g., direct labour and material; and • An allocation of other costs that relate directly to fulfilling the contract: e.g., allocation of depreciation charge on property, plant and equipment used in fulfilling the contract.

This resulted in accounting policy change for performing an onerous contract assessment.
Previously, the Authority included only incremental costs to fulfil a contract when determining whether that contract was onerous.

The revised policy includes both incremental costs and an allocation of other costs incurred to fulfil the agreement.

The amendments apply prospectively to contracts existing at the date when the amendments are first applied.
The Authority analysed contracts existing on January 1, 2022, and determined that none of them would be identified as onerous applying the revised accounting policy – i.e.

there was no impact on opening equity balance as at January 1, 2022 as a result of the change.
ii) Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16) The amendment to IAS 16 prohibits an entity deducting from the cost of an item of property, plant and equipment any proceeds received from selling items produced whilst the entity is preparing the asset for its intended use (for example, the proceeds from selling samples produced during the testing phase of a manufacturing facility after construction but before commencement of commercial production).
The proceeds from selling such samples, together with the costs of producing them, are now recognised in Statement of Profit or Loss.

These amendments had no impact on the year-end financial statements of the Authority as there were no sales of such items produced by property, plant and equipment made available for use on or after the beginning of the earliest period presented.
iii) Annual Improvements to IFRS Standards 2018-2020 (Amendments to IFRS 1, IFRS 9 & IAS 41) • IFRS 1: Subsidiary as a First-time Adopter (FTA); • IFRS 9: Fees in the ‘10 per cent’ Test for Derecognition of Financial liabilities; and • IAS 41: Taxation in Fair Value Measurements.
None of the amendments had an impact on the financial statements of the Authority as it was neither a first- time adopter, nor had modifications to the Authority’s financial instruments during the period nor had assets under IAS 41 as at the reporting date.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.
SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.2 New and amended standards and interpretations (Cont'd) 11 (a) New standards and amendments effective for annual periods beginning January 1, 2022 (Cont'd) iv) References to Conceptual Framework (Amendments to IFRS 3) In May 2020, the IASB issued amendments to IFRS 3, which updated a reference to the Conceptual Framework for Financial Reporting without changing the accounting requirements for business combinations.
These amendments had no impact on the financial statements of the Authority as there were no contingent assets, liabilities or contingent liabilities within the scope of these amendments that arose during the period.

(b) New standards and amendments not yet effective at the reporting date There are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future accounting periods that the Authority has decided not to adopt early.
(i) The following amendments are effective for the period beginning January 1, 2023: • Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2); • Deferred Tax Related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12); • Definition of Accounting Estimates (Amendments to IAS 8); and • IFRS 17 Insurance Contracts (effective January 1, 2023) - In June 2020, the IASB issued amendments to IFRS 17, including a deferral of its effective date to January 1, 2023.
(ii) The following amendments are effective for the period beginning January 1, 2024: • IFRS 16 Leases (Amendment – Liability in a Sale and Leaseback); • IAS 1 Presentation of Financial Statements (Amendment – Classification of Liabilities as Current or Non- current); and • IAS 1 Presentation of Financial Statements (Amendment – Non-current Liabilities with Covenants).
The Authority is currently assessing the impact of these new accounting standards and amendments and does not expect any other standards issued by the IASB but not yet effective, to have a material impact on its financial statements.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.
SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.3 Summary of significant accounting policies (a) Property, plant and equipment and Investment Property 12 Property, plant and equipment except for buildings and infrastructure purchased before December 31, 2014 are stated at cost less accumulated depreciation and any impairment in value.

The cost of an asset comprises its purchase price and any attributable costs of bringing the asset to working condition for its intended use.
Buildings and infrastructure purchased before December 31, 2014 are stated at revalued amount less accumulated depreciation which is their deemed cost.

The last revaluation was conducted in 2014 by a professional valuer.

These have been recognised on the grounds that the Authority has unrestricted right to the enjoyment of the future economic benefits arising from these assets.
Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow and the cost can be reliably measured.

Repairs and maintenance are charged to the Statement of Profit or Loss during the period in which they are incurred.
Depreciation is calculated on the straight line method to write off the cost of the assets over their estimated useful lives as follows: Buildings and infrastructure Plant and machinery Furniture, fittings and office equipment Motor vehicles Computer equipment Others Rate 4% 10% 20% 20% 25% 25% Capital work in progress and land is not depreciated.

Capital work in progress has been classified as a separate financial statement area.
This is reclassified to PPE or Investment Property on completion when Management finalises its ultimate purpose.

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount.

(Refer to note 2.3(e)).


An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

Gains and losses on disposal of equipment are determined by comparing proceeds with the carrying amount and are included in the Statement of Profit or Loss.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 13 2.
SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.3 Summary of significant accounting policies (Cont'd) (a) Property, plant and equipment and Investment Property (Cont'd) Apart from land which has been purchased by the Authority, the value of land transferred to the Authority at SCR1 occupied by the Authority is not included in the Financial Statements.
A number of sites occupied on Mahé including the land upon which the existing Seychelles International Airport is situated are held by the Authority on a 99-year lease at a nominal rent of SCR 1 and are on Parcel S133, S312, S5766, S5767, S5768, S5769, and S5770.

The transfer of other land ownership on Mahé and Praslin to the Authority is still under discussion with the Government.
(b) Inventories Inventories comprising of terminal and airside spares, repairs and maintenance, human resources and general items, are stated at the lower of cost and net realisable value.

In general cost is determined on a first in first out basis.

Net realisable value is the estimate of the selling price in the ordinary course of business, less the cost of completion and selling expenses.

Provisions are made for obsolete stocks based on Management's appraisal.
(c) Financial instruments (i) Recognition and measurement Financial assets and liabilities are recognised on the SCAA's Statement of Financial Position when the Authority has become a party to the contractual provisions of the instrument.

Financial assets A financial asset (unless it is a trade receivable without a significant financing component) is initially measured at fair value plus transaction costs that are directly attributable to its acquisition or issue.
A trade receivable without a significant financing component is initially measured at the transaction price.

Financial assets include trade & other receivables, cash and cash equivalent and long term deposits.

All regular way purchases and sales of financial assets are recognised on the trade date, that is, the date that the Authority commits to purchase or sell the asset.
Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the period generally established by regulation or convention in the market place.

Subsequent measurement of financial assets depends on the Authority’s business model for managing the asset and the cash flow characteristics of the asset.

The Authority’s financial assets are classified as financial assets at amortised cost, including accounts receivable, deposits, and cash and cash equivalents.
They are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost.

Financial assets at amortised cost are subsequently measured using the effective interest rate method.

Interest income, foreign exchange gains and losses if any and impairment are recognised in Statement of Profit or Loss.

Any gain on derecognition is recognised in the Statement of Profit or Loss.
SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.

SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.3 Summary of significant accounting policies (Cont'd) (c) Financial instruments (Cont'd) (i) Recognition and measurement (Cont'd) Financial liabilities 14 The Authority classifies its financial liabilities, depending on the purpose for which the liabilities were incurred.
Financial liabilities at amortised costs are initially measured at fair value, net of directly attributable cost incurred.

Financial liabilities at amortised cost including trade and other payables and borrowings are subsequently measured at amortised cost, using the effective interest method.

The related interest expense is recognised in the Statement of Profit or Loss.
(ii) Amortised cost and effective interest method The amortised cost of a financial asset is the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount, adjusted for any loss allowance.

The gross carrying amount of a financial asset is the amortised cost of a financial asset before adjusting for any loss allowance.
The effective interest method is a method of calculating the amortised cost of a financial instrument and of allocating interest income over the relevant period.

(iii) Expected credit loss on financial assets (ECL) The Authority recognises loss allowances for ECL on financial assets measured at amortised cost including trade receivable and cash and cash equivalents.
The ECLs are measured on either of the following bases: (1) 12 months ECLs: these are the ECLs that result from possible default events within the 12 months after the reporting date: and (2) lifetime ECLs: these are ECLs that result from all possible default events over the expected life of a financial asset.

The maximum period considered when estimating ECLs is the maximum contractual period over which the Authority is exposed to credit risk.

ECLs are probability-weighted estimates of credit losses.
Credit losses are measured as the difference between all contractual cash flows that are due to the Authority in accordance with the contract and all the cash flows that the Authority expects to receive.

The shortfall is then discounted at an approximation to the assets’ original effective interest rate.

The Authority measures loss allowances for trade receivable using simplified approach and has calculated ECLs based on lifetime ECLs.
The Authority has established a provision matrix that is based on the Authority’s historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.
SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.3 Summary of significant accounting policies (Cont'd) (c) Financial instruments (Cont'd) (iv) Expected credit loss on financial assets (ECL) (Cont'd) 15 For other financial assets, the ECLs are based on the 12-month ECLs.

However, when there has been a significant increase in credit risk since origination, the allowance will be based on the lifetime ECLs.
The Directors have considered that ECL on cash and cash equivalents is negligible and therefore no provision made.

(v) Derecognition The Authority derecognises a financial asset when the contractual rights to the future cash flows in relation to the financial asset expire or when the financial asset has been transferred and the transfer meets the criteria for derecognition in accordance with IFRS 9.
Financial liabilities are derecognised when the obligation specified in the relevant contract is discharged, cancelled or expires.

(vi) Offsetting financial instruments Financial assets and liabilities are offset and the net amount is reported in the Statement of Financial Position date when the Authority has a legal enforceable right to set off the recognised amounts and the Authority intends either to settle on a net basis, or to realise the asset and liability simultaneously.
(d) Cash and cash equivalents Cash and cash equivalents include cash in hand and short term deposits held with banks.

Cash equivalents are short term, highly liquid investment that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value, against which the bank overdrafts are deducted.

(e) Impairment of non-financial assets Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment.
Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

An impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount.

The recoverable amount is the higher of an asset's fair value less costs to sell and value in use.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).

(f) Capital Reserve The Authority was vested with the assets and liabilities of the former Directorate of Civil Aviation for which a financial consideration was not paid.

The net value of assets over the liabilities was credited to a Capital Reserve Account.
SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.
SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.3 Summary of significant accounting policies (Cont'd) (g) Employee Benefits (i) Short-term employee benefits 16 The cost of short-term employee benefits, (those payable within 12 months after the service is rendered, such as paid annual leave and sick leave, bonuses, and non-monetary benefits such as staff insurance), are recognised in the period in which the service is rendered and are not discounted.
The expected cost of compensated absences is recognised as an expense as the employees render services that increase their entitlement or, in the case of non-accumulating absences, when the absence occurs.

The expected cost of profit sharing and bonus payments is recognised as an expense when there is a legal or constructive obligation to make such payments as a result of past performance.
(ii) Defined contribution plans A defined contribution plan is a pension plan under which the Authority pays a fixed contribution into a separate entity.

The Authority has no legal or constructive obligations to pay further contributions if the funds do not hold sufficient assets to pay all employees the benefits relating to employees service in the current and prior periods.

The Authority and Seychellois employees contribute to the Seychelles Pension Fund (SPF).
This is a pension scheme which was promulgated under the Seychelles Pension Fund Act, 2005.

(iii) Retirement benefits Compensation and Gratuity is paid to employees upon completion of a 2-year contract in line with the Employment Act 1995 and SCAA Contract of Service.

Compensation and Gratuity are provided for in the accounts yearly and expensed under Staff costs.

The Authority accrues this liability on a current basis and carries it to a provision account for payments to be made as and when they occur.
(h) Taxation (i) Current tax Tax in the Statement of Profit or Loss relates to current year's tax which is the expected amount of tax payable in respect of taxable profit for the year and is measured using the tax rates that have been enacted at the end of the reporting period.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.
SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.3 Summary of significant accounting policies (Cont'd) (h) Taxation (Cont'd) (ii) Deferred tax 17 Deferred tax is provided for using the liability method on all taxable temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.
The principal temporary differences arise from tax losses, unrealised exchange movements, provision for credit losses, payroll provisions and accelerated tax depreciation.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled.

The tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date are used to determine deferred tax.
Current and deferred taxes are recognised as income or expenses in the Statement of Profit or Loss.

Deferred tax assets are recognised to the extent that it is possible that future taxable profit will be available against which the temporary differences can be utilised.

(i) Provisions Provisions are recognised when the Authority has a present obligation (legal or constructive) as a result of past event.
It is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount of the obligation can be made.

(j) Foreign currencies (i) Functional and presentation currency Items included in the financial statements are measured in Seychelles Rupees, the currency of the primary economic environment in which the Authority operates (functional currency).
The financial statements are presented in Seychelles Rupees, which is the Authority's functional and presentation currency.

(ii) Transaction and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing on the dates of the transactions.
Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Profit or Loss.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rates at the date of transaction.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.
SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.3 Summary of significant accounting policies (Cont'd) (k) Revenue recognition 18 The Authority earn revenue from aeronautical and non-aeronautical goods and services: Aeronautical revenue Aeronautical revenue relates to the following services and is recognised in accordance with IFRS 15 and it is governed by the Statutory Instruments: i Landing fees ii Aircraft parking Passenger service charges Air Navigation Fees Safety & security regulation - Using regulated tariffs for aircraft landings based on maximum take-off weight for each landing by an airline.
- - - - On regulated tariffs for each aircraft parked by an airline for more than six hours, based on length and wingspan of aircraft per 24 hours.

Using regulated tariffs for each departing passenger at an airport of departure.

Using regulated tariff based on distance flown in the FIR and maximum take-off weight of aircraft.

Tariff based on different type of safety and security oversight services provided to Aircraft and Service Providers.
The Authority accounts for contracts with customers for each revenue stream when all five steps for revenue recognition in accordance with IFRS 15 have been addressed.
These steps have been outlined as follows: The contract has been approved by the parties to the contract – the contracts are implied based on aviation business practices; Each party’s rights in relation to the goods or services to be transferred can be identified – the Authority has the right to restrict access to the facilities it provides to customers should they not pay as stipulated by agreed terms for the services it provides; (c) The payment terms for the goods or services to be transferred can be identified (see below); (d) (e) The contract has commercial substance – the contracts affect the Authority’s cash flows and risk as transactions are entered into to earn a profit; and It is probable that the consideration to which the entity is entitled to in exchange for the goods or services will be collected – the Authority considers the customer’s ability and intention to pay the amount of consideration based on prior business dealings with the customer.
The Authority satisfies its performance obligations in relation to its revenue streams at a point in time, as follows: i Landing fees – upon landing of an aircraft at the Authority’s airports.

ii Passenger service fees – upon departure by a passenger from the Authority’s airports.

iii Air navigation fees - after the aircraft has passed in the Seychelles Flight Information Region (FIR).
iv Safety and security - upon the delivery of Airworthiness certificate to aircraft and licences validation for aviation personnel.

iii iv v (a) (b) SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 2.

SIGNIFICANT ACCOUNTING POLICIES (CONT'D) 2.3 Summary of significant accounting policies (Cont'd) (k) Revenue recognition (Cont'd) 19 Revenue is due within 30 days of satisfaction of a performance obligation.
There are no warranties, returns and any related obligations in relation to the Authority’s revenue streams.

Revenue is measured at the transaction price allocated to that performance obligation.

Non-aeronautical revenue Non-aeronautical revenue relates to lease income and other revenue.

Revenue from leasing activities is recognised in accordance with IFRS 16 on a straight line basis over the lease term.
Other revenue is recognised in accordance with IFRS 15 as detailed below: Retail Concession - Based on the higher of a minimum guaranteed rental and/or a percentage of turnover.

Parking - Based on time-based tariffs.

Rental and Lease - Based on medium and long-term rental & lease agreements with tenants.

Other - Recognised based on type of permit as well as the access that the permit grants or services provided such as fuel throughput and Aircraft security services.
(l) Leases The Authority assesses at contract inception whether a contract is, or contains, a lease.

That is, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

The Authority applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets.
The Authority recognises lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.

The Authority had a lease for a period of less than one year and the Directors applied the exemption per IFRS 16 not to recognise right-of-use assets and liabilities for leases with low value or having a lease period of less than 1 year.

3.
3.

CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS Estimates and judgements are continuously evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

3.1 Critical accounting estimates and assumptions The Authority makes estimates and assumptions concerning the future.

The resulting accounting estimates will, by definition, seldom equal the related actual results.
However, in the financial statements, there were no estimates and assumptions that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities of the Authority within the next financial year.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 20 3.
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONT'D) (a) Impairment of Financial Assets The loss allowances for financial assets are based on assumptions about risk of default and expected loss rates.

The Authority uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Authority's past history, existing market conditions as well as forward looking estimates at the end of each reporting period.
The Authority’s historical credit loss experience and forecast economic conditions may therefore not be representative of the actual default in the future.

Bank balances have been assessed to have low credit risk at each reporting date as they are held with reputable banking institutions.

Directors have estimated impairment to be immaterial.
(b) Depreciation Policies Property, Plant and Equipment and investment property (notes 5 & 6) are depreciated to their residual values over their estimated useful lives.

The residual value of an asset is the estimated net amount that the Authority would currently obtain from the disposal of the asset, if the asset were already of the age and in condition expected at the end of its useful life.
The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors.

In reassessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account.

Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
The Directors therefore make estimates based on historical experience and use best judgement to assess the useful lives of assets and to forecast the expected residual values of the asset at the end of their expected useful lives.

(c) Split between Property, plant and equipment and Investment property The Directors split portions of buildings for rental from those for own based on floor space being rented.
Thus building for own use is approximated estimated at 70% of the area while 30% of the remaining for rental.

(d) Impairment of Fixed Assets Property, Plant and Equipment and Investment Property (notes 5 & 6) are considered for impairment if there is a reason to believe that impairment may be necessary.

Factors taken into consideration in reaching such a decision include the economic viability of the asset itself and where it is a component of a larger economic unit, the viability of that unit itself.
Future cash flows expected to be generated by the assets or cash-generating units are projected, taking into account market conditions and the expected useful lives of the assets.

The present value of these cash flows, determined using an appropriate discount rate, is compared to the current net asset value and, if lower, the assets are impaired to the present value.

Cash flows which are utilised in these assessments are extracted from the yearly budget.
SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 3.

CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONT'D) (e) Functional Currency 21 The Board of Directors have determined the Seychelles Rupees to be the functional currency of the Authority [Refer to note 2.1.]

(f) Limitation of Sensitivity Analysis Sensitivity analysis in respect of market risk demonstrates the effect of a change in a key assumption while other assumptions remain unchanged.
In reality, there is a correlation between the assumptions and other factors.

It should also be noted that these sensitivities are non-linear and larger or smaller impacts should not be interpolated or extrapolated from these results.

Sensitivity analysis does not take into consideration that the Authority's assets and liabilities are managed.
Other limitations include the use of hypothetical market movements to demonstrate potential risk that only represent the Authority's view of possible near-term market changes that cannot be predicted with any certainty.

4.

FINANCIAL RISKS MANAGEMENT The Authority’s comprehensive risk management process involves identifying, understanding and managing the risks associated with each of the Authority’s business units.
Risk awareness, control and compliance are embedded in the Authority’s day-to-day activities.

The Authority operates within clearly defined guidelines that are approved by the Board and the Authority's policy is not to engage in speculative transactions.

The Board recognises the critical importance of having efficient and effective risk management policies and systems in place.
To this end, there is clear organisational structure with delegated authorities and responsibilities from the Board to Management.

A description of the significant risks is given below together with the risk management policies applicable.

4.1 Credit Risk Credit risk is the risk of loss to the Authority as a result of the failure by a customer or counterparty to meet its contractual obligations.

The Authority's credit risk arises mainly from trade and other receivables and cash and bank balances.
Though 95% of the Authority's international collections or billings are collected by IATA clearing house, the credit risk concentration on trade and other receivables are being mitigated.

Most international revenue is collected within the 60 days except rejected billings which takes more time to reconcile.

The credit quality of trade and other receivable that are neither past due nor impaired can be assessed by reference to historical information about each customer.
Apart from IATA, credit limits on all customer is 30 days.

The allowance account in respect of trade receivables and other receivable is used to record impairment losses unless the Authority is satisfied that no recovery of the amounts owing is possible.

At that point, the amounts considered irrecoverable are written off against the allowance account.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 4.
FINANCIAL RISKS MANAGEMENT (CONT'D) 4.2 Foreign currency risk 22 Foreign currency risk is the risk that the fair value of future cash flows of an exposure will fluctuate because of changes in foreign exchange rates.

The Authority’s exposure to the risk of changes in foreign exchange rates relates primarily to the Authority’s operating activities when revenue, expense and borrowings is denominated in a foreign currency.

Foreign currency risk is not hedged.
As at December 31, the Authority's exposure to foreign currency risk was as follows, based on the notional amounts: 2022 2021 Notional Amount Year End Spot Rate SCR Amount Notional Amount Year End Spot Rate SCR Amount Trade and other receivables In USD In Euro Cash and Bank Balances In USD In Euro In Pound Sterling Borrowings In USD Trade and Other Payables In USD At December 31, if the Seychelles Rupees had weakened/strengthened by 5% against United States Dollar and Euro with all variables held constant, impact on results would have been as follows: 2022 Euro SCR +/- 82,947 61,777 - - USD SCR +/- 2021 Euro SCR +/- USD SCR +/- 6,555,748 4,482,692 2,356,815 1,237,432 44,192 69,553 - - 3,436,912 3,629,917 1,528,824 1,576,063 144,724 14,632,687 113,745 10,171,716 Cash and bank balances Trade and other receivables Borrowings Trade and other Payables 4.3 Interest rate risk Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates.
It is the Authority's policy to manage interest cost using a mix of fixed and variable rates debts.

As at December 31, 2022, the Authority had borrowing from Nouvobanq at 5.31%, being 5% plus 3 months Secured Overnight Financing Rate (SOFR), whilst interest bearing assets on fixed deposits were between 2.0% to 2.5%.

Therefore the impact of interest rate risk was immaterial.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 4.
FINANCIAL RISKS MANAGEMENT (CONT'D) 4.4 Liquidity risk 23 Prudent liquidity risk management includes maintaining sufficient cash and marketable securities, the availability of funding from an adequate amount of committed credit facilities and the ability to close out market positions.

The Authority maintaining flexibility in funding by keeping committed credit lines available.
Management monitors rolling forecasts of the Authority's liquidity reserve on the basis of expected cash flow and do not foresee any major liquidity risk over the short term.

The table below analyses the Authority's financial liabilities into relevant maturity groupings based on the remaining period at the end of the reporting period to the contractual maturity date.
At December 31, 2022 Gross borrowings Gratuity and compensation Trade and other payables At December 31, 2021 Gross borrowings Gratuity and compensation Trade and other payables Less than 1 year Between 1 and 3 years SCR SCR Over 3 years SCR Total SCR 16,021,086 10,546,597 55,601,639 32,042,172 3,377,496 - 10,091,663 - - 58,154,921 13,924,093 55,601,639 82,169,322 35,419,668 10,091,663 127,680,653 15,330,631 11,864,285 40,475,090 33,448,649 4,702,638 - 5,890,147 - - 54,669,427 16,566,922 40,475,090 67,670,005 38,151,287 5,890,147 111,711,439 4.5 Capital risk management The Authority's objectives when managing capital are: • to safeguard the entity's ability to continue as a going concern, so that it can continue to provide returns for • to provide an adequate return to Government by pricing products and services commensurately with the level of risk.
The Authority sets the amount of capital in proportion to risk.

The Authority is not subject to external imposed capital requirements.

It manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets.
In order to maintain or adjust the capital structure, the Authority in negotiation with Government of Seychelles, may adjust the amount of dividends paid to the Government of Seychelles and increase or reduce debt.

Net debt is calculated as total interest-bearing borrowings (including current and non-current borrowings) less cash and bank balances plus short-term investment while equity include capital reserve and retained earnings.
As at December 31, 2022 Gearing was estimated to be Nil as Cash and bank balances exceed total debts.

(2021: None).

4.6 Fair value estimation The nominal value less estimated credit adjustments of financial approximate their fair values.

liabilities and assets are assumed to SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 5.
PROPERTY, PLANT & EQUIPMENT Costs 24 Land Building & Infrastructure Plant & Machinery Furniture, Fittings & Office Equipment Motor Vehicles Computer – Hardware & Software Other Assets Total SCR SCR SCR SCR SCR SCR SCR SCR As at January 1, 2021 6,780,800 448,510,417 111,504,178 26,585,220 57,620,100 88,264,879 31,588,573 770,854,167 Additions Direct Purchase Transfer from WIP Disposals - - - - 243,577 3,020,931 - 2,951,711 463,075 463,075 243,577 - 69,220 - - - - - - 477,175 477,175 - 126,632 4,331,390 126,632 4,018,593 - 312,797 (753,342) (204,176) (48,106) (1,005,624) As at December 31, 2021 6,780,800 448,753,994 114,525,109 27,048,295 56,866,758 88,537,878 31,667,099 774,179,933 Additions Direct Purchase Transfer from WIP Disposals - - - - 3,289,002 11,315,411 1,041,772 1,083,556 14,519,754 243,279 31,492,774 1,435,037 4,378,089 1,041,772 1,853,965 6,937,322 - 487,826 595,730 4,522,190 9,997,564 243,279 12,108,193 - 19,384,581 - (5,473) (26,594) - (419,334) (1,018,704) (1,470,105) As at December 31, 2022 6,780,800 452,042,996 125,835,047 28,063,473 57,950,314 102,638,298 30,891,674 804,202,602 Included in land, buildings and infrastructure is a house on Parcel S5256 purchased on March 28, 2018 for a sum of seven million Seychelles rupees (SCR 7m).
As a result of matrimonial dispute, a Court injunction on registration of Transfer has been imposed pending settlement of the matter.

Ongoing Civil Suit set for hearing pending attempts for a judgement by consent.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 5.
PROPERTY, PLANT & EQUIPMENT (CONT'D) 25 Land Building & Infrastructure Plant & Machinery Furniture, Fittings & Office Equipment Motor Vehicles Computer – Hardware & Software Other Assets Total SCR SCR SCR SCR SCR SCR SCR SCR - - - - - - - 162,817,732 70,105,587 21,581,477 50,278,766 79,394,678 27,185,423 411,363,663 17,940,417 6,811,425 1,929,058 3,790,131 4,269,167 2,341,847 37,082,045 - - - (326,448) (46,310) (48,106) (420,864) 180,758,149 76,917,012 23,510,535 53,742,449 83,617,535 29,479,164 448,024,844 17,980,631 7,285,831 1,688,687 1,883,042 3,952,843 1,704,802 34,495,836 - (2,371) (24,988) - (379,147) (1,018,704) (1,425,210) 198,738,780 84,200,472 25,174,234 55,625,491 87,191,231 30,165,262 481,095,470 Accumulated Depreciation As at January 1, 2021 Depreciation for the year Disposals Depreciation As at December 31, 2021 Depreciation for the year Disposals Depreciation As at December 31, 2022 Net Book Value As at December 31, 2021 6,780,800 267,995,845 37,608,097 3,537,760 3,124,309 4,920,343 2,187,935 326,155,089 As at December 31, 2022 6,780,800 253,304,216 41,634,575 2,889,239 2,324,823 15,447,067 726,412 323,107,132 SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 6.
INVESTMENT PROPERTY COST At January 1, Additions At December 31, ACCUMULATED DEPRECIATION At January 1, Charge for the year At December 31, NET BOOK VALUE 7.

CAPITAL WORK IN PROGRESS At January 1, Expenditure incurred during the year Transfer to property, plant & equipment (note 5) 8.
DEFERRED TAX 26 2022 SCR 2021 SCR 88,697,695 88,697,695 - - 88,697,695 88,697,695 36,015,096 32,467,188 3,547,908 3,547,908 39,563,004 36,015,096 49,134,691 52,682,599 2022 SCR 2021 SCR 44,303,484 8,045,459 67,299,983 36,570,822 (19,384,581) 92,218,886 (312,797) 44,303,484 (a) Deferred taxes are calculated on all temporary differences under the liability method at applicable rates as mentioned in note 11(d).
There is a legally enforceable right to offset deferred tax assets and deferred tax liabilities when the deferred taxes relate to the same fiscal authority for the same entity.
(b) The following amounts are shown in the Statement of Financial Position: Deferred tax assets (note 8(c)(i)) Deferred tax liability (note 8(c)(ii)) The movement on the deferred tax account is as follows: At January 1, Credit to Statement of Profit or Loss (note 11(b)) At December 31, 2022 SCR 8,165,232 (9,509,202) (1,343,970) 2021 SCR 34,605,365 (9,513,433) 25,091,932 2022 SCR 2021 SCR 25,091,932 (26,435,902) (1,343,970) 24,443,587 648,345 25,091,932 SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 8.
DEFERRED TAX (CONT'D) 27 (c) Deferred tax is recognised in the Statement of Financial Position with respect to the following: (i) Deferred Tax Assets Tax Losses Unrealised Exchange Loss Provision for Credit Losses Payroll Provisions SCR SCR SCR SCR Total SCR y 27,946,390 (3,032,293) 1,950,525 - 1,496,616 7,540,809 36,983,815 806,212 967,454 730,182 1,175,540 (882,549) (2,378,450) 449,103 4,542,622 g ) At January 1, 2021 ( restated Change in temporary Change in tax rate (notes 11(b) (4,982,818) (161,242) (445,358) (1,331,652) (6,921,072) At December 31, 2021 24,914,096 806,212 2,226,797 6,658,260 34,605,365 Credit/(Charge) for the year (24,914,096) (530,522) (616,739) (378,776) (26,440,133) At December 31, 2022 - 275,690 1,610,058 6,279,484 8,165,232 (ii) Deferred Tax Liability At January 1, 2021 Charge/(Credit) for the year Change in temporary difference at old rate Change in tax rate (notes 11(b) & 11(d)) At December 31, 2021 Charge/(Credit) for the year At December 31, 2022 9.
INVENTORIES Terminal and Airside Spares Maintenance Spares & Consumables (PME) Maintenance Spares & Consumables (Bld & Infra) Office and & General; Admin Consumables Accelerated Tax Depreciation Unrealised Exchange Gain Total SCR SCR SCR 11,542,536 997,692 12,540,228 (2,029,103) (997,692) (3,026,795) (126,416) (997,692) (1,124,108) (1,902,687) 9,513,433 (4,231) 9,509,202 - - - (1,902,687) 9,513,433 (4,231) 9,509,202 2022 SCR 908,144 4,795,257 1,153,746 804,489 7,661,636 2021 SCR 694,179 3,298,975 688,829 1,677,269 6,359,252 SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 10.
TRADE AND OTHER RECEIVABLES Gross trade receivables (note 10(a)) Less: Allowance for expected credit loss (notes 10(b) & 10(c)) Other receivables Prepayments 28 2022 2021 SCR 115,923,896 (6,440,230) 109,483,666 783,827 2,916,972 113,184,465 SCR 91,260,682 (8,907,184) 82,353,498 2,843,910 1,683,342 86,880,750 (a) The carrying value of trade and other receivables measured at amortised cost approximates its fair value.
(b) Credit Loss Allowances The Authority measures the loss allowance for trade receivables at an amount equal to lifetime ECL.
The expected credit losses on trade receivables are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor’s current financial position, adjusted for factors that are specific to the debtors, general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of conditions at the reporting date.
There has been no change in the estimation techniques or significant assumptions made during the current reporting period.

The Authority writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery, i.e., when the debtor has been placed under liquidation or has entered into bankruptcy proceedings.

The average credit period on trade receivables is 60 days.
No interest is charged on outstanding trade receivables.

The following table details the risk profile of trade receivables based on the Authority’s provision matrix.
(i) At December 31, 2022 < 30 days 31-60 days 61-90 days > 90 days Total Trade receivables-days past due Gross amount (SCR) 93,288,702 5,330,795 3,909,434 13,394,965 115,923,896 Expected loss rate (%) 0.74% 0.85% 5.09% 41.10% Lifetime ECL (SCR) 690,336 45,312 198,990 5,505,592 6,440,230 ii) At December 31, 2021 < 30 days 31-60 days 61-90 days > 90 days Total Trade receivables-days past due Gross amount (SCR) 79,027,960 2,514,774 1,241,578 8,476,371 91,260,683 Expected loss rate (%) 3.75% 4.59% 25.22% 65.06% Lifetime ECL (SCR) 2,963,549 115,428 313,126 5,515,081 8,907,184 SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 10.
TRADE AND OTHER RECEIVABLES (CONT'D) iii) Expected credit loss movement during the year is as follows: At January 1, Charge for the year At December 31, (c) Sensitivity analysis 29 2022 SCR 2021 SCR 8,907,184 (2,466,954) 6,440,230 4,988,718 3,918,466 8,907,184 If the ECL rates on trade receivables above 90 days past due had been 1% higher/(lower) as of December 2022, the loss allowance would have been +/- SCR 55,056 (2021: +/- SCR 55,155).
(d) Trade and other receivables include SCR 10.5m due to related parties.

(2021: SCR 7.2m) (note 26 (b).

11.
CURRENT TAX ASSET (a) Statement of Financial Position At January 1, Charge to Statement of Profit or Loss (note 11(b)) Net receipts/(payments) during the year At December 31, (b) Statement of Profit or Loss Current tax at applicable tax rate (notes 11(a) & (d)) Deferred tax credit (note 8(b)) (c) Reconciliation between tax expense and accounting profit is as follows: Loss Before Taxation: Tax calculated at applicable tax rates (note 11(d)) Expenses not deductible for tax purposes Income exempt for tax purposes Excess of capital allowances over depreciation Unutilised tax losses carried forward 2022 2021 SCR (5,593,858) 7,623,548 (8,340,750) (6,311,060) SCR (18,975,768) 13,381,909 (5,593,859) 7,623,548 26,435,902 34,059,450 - 648,345 (648,345) 136,313,712 (42,841,072) 33,978,428 (12,852,322) (1,928,614) 12,711,715 505,361 (17,532) (24,914,095) 7,623,548 (1,975,810) 165,892 1,950,525 - SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 11 CURRENT TAX ASSET (CONT'D) (d) Applicable tax rates are as follows: 30 In exercise of the powers conferred by section 81 of the Business Tax Act 2009, the Minister of Finance, Economic Planning and Trade announced changes to tax rates for all Companies effective January 1, 2022 which resulted in income below SCR 1million being charged at 15% and above SCR 1million charged at 25% (2021: 25% and 30% respectively) .
12 Cash & Cash Equivalent Cash on Hand Cash at Bank Total Cash & Bank Balances Fixed Deposit Cash & Cash Equivalent for Cash Flow 13.

CAPITAL RESERVE 2022 SCR 308,496 223,363,824 2021 SCR 271,840 149,181,893 223,672,320 (75,895,698) 147,776,622 149,453,734 (73,243,270) 76,210,464 The Authority was vested with the assets and liabilities of the former Directorate of Civil Aviation for which a financial consideration was not paid.
The net value of assets over the liabilities was credited to a Capital Reserve Account.

14.
14.

BORROWINGS At January 1, Received during the year Paid during the year Exchange Movement At December 31, Analysed as: Non-current Current 2022 SCR 30,576,479 31,468,496 (12,658,849) (2,249,825) 47,136,301 2021 SCR - 33,349,175 (2,772,696) 30,576,479 33,992,398 13,143,903 47,136,301 17,301,530 13,274,949 30,576,479 (a) The Authority obtained a loan of USD 5 million from Seychelles International Mercantile Banking Corporation Limited (Nouvobanq).
The loan is secured by a first line charge and a floating charge of the Authority's worth to secure USD 5 million.

The loan attracts a fixed interest rate of 5.24% per annum charged on the daily outstanding balances and compounded monthly.

The rate has changed in 2022 to 5.315 following a change in banks computation using SOFR rate.

Interest charges amount to SR2.7m.

The loan repayment is subject to a moratorium period of 9 months and thereafter payable over 57 months.
The fair value is not significantly different to their carrying value.

(b) The exposure of the Authority 's borrowings to foreign exchange risk and maturity profile are shown on notes 4.2 and 4.4 repectively.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 15.
Employee Benefits & Leave Provisions (a) Gratuity and Compensation At January 1, Charge for the year Accrued Paid during the year At December 31, Analysed as: Non-current Current (b) Accrued Leave At January 1, Charge for the year (note 19) At December 31, 16.

TRADE AND OTHER PAYABLES Trade payables Levies due to Government (note 27) Other payables 17.
REVENUE Aeronautical Landing fees Passenger Service Charges Air Navigation Charges Safety Regulation Charges Non-aeronautical Concession & Property Rental Aviation Security Fees Others Airport Fees Total Revenue 31 2022 SCR 2021 SCR 16,566,923 9,221,455 15,398,611 13,795,177 (11,864,285) 13,924,093 (12,626,866) 16,566,923 3,377,496 4,702,638 10,546,597 13,924,093 11,864,285 16,566,923 2022 SCR 2021 SCR 10,066,121 9,737,421 1,127,722 11,193,843 328,700 10,066,121 2022 SCR 11,030,210 32,524,094 12,047,335 55,601,639 2021 SCR 2,027,872 33,451,927 4,995,291 40,475,090 2022 SCR 2021 SCR 29,897,007 19,729,432 270,034,396 151,873,514 124,728,666 84,292,036 528,170 425,188,239 529,795 256,424,777 43,411,326 31,909,886 4,271,096 531,730 3,641,162 108,199 48,214,152 473,402,391 35,659,247 292,084,024 SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 18.
OTHER INCOME Administration fees Profit on disposal Others 19.

EMPLOYEE BENEFIT COSTS Salaries and wages Employer's Pension Costs Compensation, Gratuity & Bonus Leave accrual (note 15 (b)) Learning and Development Others Benefits 20.
OTHER OPERATING OVERHEADS Office & General Administrative Costs ICT Service Support & Maintenance Air Navigation Support Services & Maintenance Safety & Security Regulation Costs Airport Operation Cost Commercial Corporate social responsibility Tax Electrical and Technical Services & Maintenance Auditor's remuneration Professional Fees Finance charges 21.
EXCHANGE MOVEMENTS Realised exchange loss/(gain) Unrealised exchange loss/(gain) Receivables Unrealised exchange loss/(gain) Payables Unrealised exchange loss/(gain) Borrowing Unrealised exchange loss/(gain) on bank 32 2021 SCR 132,236 170,583 956,006 1,258,825 2021 SCR 2022 SCR 140,780 388,218 316,619 845,617 2022 SCR 175,050,398 164,141,203 7,483,741 17,318,497 1,127,722 7,407,430 4,829,614 17,586,909 328,700 2,317,798 7,169,602 215,557,390 6,131,280 195,335,503 2022 SCR 2021 SCR 17,573,131 11,972,340 6,726,525 5,787,690 301,128 10,153,413 6,126,170 - 31,092,252 150,000 255,000 44,252 78,209,561 2022 SCR (292,736) 1,050,277 52,481 (2,249,825) 4,653,209 3,213,407 4,218,616 7,168,396 918,096 6,226,913 1,696,532 175,959 29,702,675 100,000 29,047 62,208,574 2021 SCR 4,392,471 2,492,276.83 732,570 (2,772,696) 29,101,100 33,945,721 SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 22.
FINANCE INCOME Interest from fixed deposit Interest on staff loans 23.

PROFIT/(LOSS) FOR THE YEAR This has been arrived at after charging: - Auditor's remuneration - Directors' remuneration (note 26(e)) 24. DIVIDEND PAID 33 2022 SCR 2,404,455 65,388 2,469,843 2021 SCR 3,642,756 210,218 3,852,974 2022 SCR 150,000 347,136 2021 SCR 100,000 345,600 Dividend to Government is made in accordance with directions given by the Minister under Section 11 (3) of the Seychelles Civil Aviation Authority Act, 2005.
Dividends of SCR 15,000,000 has been declared and paid during the year under review (2021: Nil).

25.

COMMITMENTS Capital Commitments Approved and contracted for Approved and but not contracted for 26.
RELATED PARTY TRANSACTIONS (a) Identification of related parties 2022 SCR 2021 SCR 37,752,560 83,792,873 - - 37,752,560 83,792,873 SCAA is a public entity established under the Seychelles Civil Aviation Authority Act, 2005 of Seychelles and reports to the Minister for Transport, Civil Aviation and Ports & Marine.

It therefore has a significant number of related parties including other state-owned entities, government departments and other entities within the sphere of Government.
In addition, the Authority has a related party relationship with its Directors and Executive officers (Key Management).

Unless specifically disclosed, transactions are concluded on an arm’s length basis and the Authority is open to transact with any entity.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 26.
RELATED PARTY TRANSACTIONS (CONT'D) 34 Key Management Personnel has been defined as the Authority's Board of Directors, CEO and Senior Executive effective for 2022 and 2021.

Non-executive Directors are included in the definition of key management personnel as required by IFRS.

The definition of Key Management includes close family members of key management personnel and any entity over which key management exercises control or joint control.
(b) Related Party Transaction and Balances Balances Transactions Loans & Advance Deposits Levies Collected Trade Receivable Trade Payables SCR SCR SCR SCR SCR December 31, 2022 Public Entities Government organisations and agencies December 31, 2021 Public Entities Government organisations and agencies 47,136,301 169,698,206 10,473,691 2,859,838 - - (32,524,094) - - (30,576,479) 100,379,523 - 7,244,671 2,680,160 - - (33,451,927) - - (c) Remuneration to Executive Key Management The aggregate remuneration provided for and paid to Key Management personnel comprised.
*Chief Executive Officer Other Key Management Personnel Staff Salary and allowances End on Contract Payment (EOC) 2022 SCR 2021 SCR 1,080,000 1,493,409 6,622,404 1,052,722 8,755,126 6,308,767 1,090,532 8,892,708 *The increase in CEO's renumeration in 2021 is due to his 3 year End of Contract payment.

No other benefits was paid to Key Management Staff in 2022.

(d) Loans and advances to key management Loans to Key Management personnel were approved and disbursed as per the Authority's loan policy.
As at December 31, 2022 loans and advances to Key Management amounted to SCR 71,475 (2021: SCR 200,094).

There were no new loans issued in 2020 & 2021.

SEYCHELLES CIVIL AVIATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2022 26.
RELATED PARTY TRANSACTIONS (CONT'D) (e) Directors' Fees to Non-Executive Directors Marlon Orr Sherin Francis May-Paul Marengo Kelly Chetty Garry Jupiter Yannick Roucou Magalie Essack Noella Vinda Piedro Pierre Suketu Patel Anne Lafortune Vincent Amelie Nadine Potter Cindy Vidot Benjamin Choppy Ange Morel 35 2021 SCR 63,360 42,240 42,240 42,240 42,240 42,240 42,240 5,760 3,840 3,840 3,840 3,840 3,840 3,840 345,600 Resignation Appointment Feb-21 Feb-21 Feb-21 Feb-21 Feb-21 Feb-21 Feb-21 Jul-22 Jul-22 May-20 Feb-14 May-17 May-17 May-17 May-20 May-20 Jun-22 Apr-22 Jan-21 Jan-21 Jan-21 Jan-21 Jan-21 Jan-21 Jan-21 2022 SCR 69,120 55,296 19,200 46,080 26,880 46,080 46,080 19,200 19,200 - - - - - - - 347,136 27.
Events After The Reporting Period Announcement of a Major Restructuring Following the Cabinet approval of a bill by Cabinet of Ministers in October 2021, the Management of SCAA and the Board embarked on the preparatory journey for the separation of SCAA into two legal entities.
The separation shall entail that SCAA shall remain as the regulatory and oversight body for safety, security and civil aviation operations in our jurisdiction and; the other entity shall become the Airport Authority responsible for air navigation, fire and rescue, security and passenger welfare in the general operations of the airport on a commercial basis.

The restructuring shall support to achieve reduction of potential conflicts of interest between the regulatory authority and the service provider.
It will also allow the Airport Authority to derive maximum commercial opportunities.

New Subsidiary company Air Seychelles Ltd (a Government of Seychelles State Owned Entity) with sole ownership of specialized Ground Servicing Equipment and exclusive provider of Ground Handling Services at Seychelles International Airport for domestic and foreign airlines.
As part of the Air Seychelles Ground handling Ring-fencing to safeguard against the inherent risk and consequence to the continuity of Ground Handling Services at Seychelles International Airport, Government of Seychelles (GoS) provided approval to Seychelles Civil Aviation Authority (SCAA) to participate in the formation of a subsidiary company.

As a result a subsidiary company called Seychelles Aviation Handling Company, was created in January 2023, 99% owned by SCAA and 1% owned by GoS.
Below are a few of the main objectives of SAHC : (a)To purchase, own or lease specialized Ground Services Equipment to holders of Ground Handling Permit for the purpose of airport ground handling activities; (b)To sub-let, assign or otherwise dispose interest in movable and immovable property necessary or convenient for the pursuit of any of the foregoing objects; (c)To borrow or raise or secure payment of money in such a manner as the company shall think fit; (d) To provide, manage, coordinate ground handling services of every description at Seychelles International Airport and Praslin Airport; for the avoidance of doubt, such services are defined as all airport services necessary for the arrival and departure of an aircraft, which are not part of air traffic services.
The above events and information does not affect any amounts recognised in the 2022 financial statements, and the Authority will continue to operate as a going concern.