18. Trade and other receivables
2019 | 2018 | |
|---|---|---|
€m | €m | |
Trade receivables | 44.8 | 40.3 |
Allowance for expected credit losses | (1.5) | (1.4) |
43.3 | 38.9 | |
Prepayments | 43.4 | 35.3 |
Finance Lease receivable (note 16) | 2.7 | - |
Other receivables | 3.0 | 1.5 |
92.4 | 75.7 |
The Group and Company extend credit to certain trade customers after conducting a credit risk assessment. Year-end trade receivables represent 46 days sales at 31 December 2019 (2018: 45 days). Prepayments includes €28.9 million relating to a €33.0 million deposit on a vessel under construction less amount recognised in property plant and equipment and further amounts of €8.1 million relating to deposits on capital works due to be carried out post year end.
The Group’s trade receivables are analysed as follows:
Gross value | Expected Credit Losses | Net value | Gross value | Expected Credit Losses | Net value | |
|---|---|---|---|---|---|---|
2019 | 2019 | 2019 | 2018 | 2018 | 2018 | |
€m | €m | €m | €m | €m | €m | |
Not past due | ||||||
Within terms | 39.9 | 1.2 | 38.7 | 35.6 | (1.0) | 34.6 |
Past due | ||||||
Within 3 months | 4.4 | 0.2 | 4.2 | 3.9 | (0.3) | 3.6 |
After 3 months | 0.5 | 0.1 | 0.4 | 0.8 | (0.1) | 0.7 |
44.8 | (1.5) | 43.3 | 40.3 | (1.4) | 38.9 |
Risk of expected credit losses
The Group has applied the IFRS 9 simplified model of recognising lifetime expected credit losses for all trade receivables as these items do not have a significant financing component. The concentration of credit risk is limited due to the exposure being spread over a large number of counterparties and customers. In measuring the expected credit losses, the trade receivables have been grouped by shared credit risk characteristics and by days past due. The expected loss rates are heavily influenced by the past rate of actual credit losses. Trade receivables are written off when there is no reasonable expectation of recovery.
Movement in the allowance for doubtful debts
2019 | 2018 | |
|---|---|---|
€m | €m | |
Balance at beginning of the financial year | 1.4 | 1.5 |
Increase/(decrease) in allowance during the financial year | 0.1 | (0.1) |
Balance at end of the financial year | 1.5 | 1.4 |
The amount included in prepayments relating to a shipyard deposit is secured through letters of credit issued by high quality insurers. In relation to the amounts paid as deposits on other capital works, significant progress on these works had been completed by the financial statement approval date. No allowance has been made for expected credit losses on prepayments and other receivables as they were assessed as not being impaired at 31 December 2019.