NOTES TO THE FINANCIAL STATEMENTS
For The Financial Period From 1 January 2014 To 31 March 2015 (Cont’d)
114
Annual Report 2015
45. FINANCIAL INSTRUMENTS (CONT’D)
45.1 FINANCIAL RISK MANAGEMENT POLICIES (CONT’D)
(a) Market Risk (Cont’d)
(i) Foreign Currency Risk (Cont’d)
The Company does not have any transactions or balances denominated in foreign
currencies. Hence, it is not exposed to foreign currency risk.
Foreign currency risk sensitivity analysis
The following table details the sensitivity analysis to a reasonably possible change in
the foreign currencies at the end of the financial period/year, with all other variables
held constant:-
Group
31.3.2015
31.12.2013
(Decrease)/
(Decrease)/
Increase
Increase
RM’000
RM’000
Effects On Profit After Taxation/Equity
USD/RM:
- strengthened by 5%
(42)
(349)
- weakened by 5%
42
349
EUR/RM:
- strengthened by 5%
–
(86)
- weakened by 5%
–
86
(ii) Interest Rate Risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument
will fluctuate because of changes in market interest rates. The Group’s exposure to
interest rate risk arises mainly from interest-bearing financial assets and liabilities. The
Group’s policy is to obtain the most favourable interest rates available. Any surplus
funds of the Group will be placed with licensed financial institutions to generate
interest income.
Information relating to the Group’s exposure to the interest rate risk of the financial
liabilities is disclosed in Note 45.1(c) to the financial statements.
Interest rate risk sensitivity analysis
The following table details the sensitivity analysis to a reasonably possible change
in the interest rates at the end of the financial period/year, with all other variables
held constant:-
Group
Company
31.3.2015 31.12.2013 31.3.2015 31.12.2013
(Decrease) (Decrease) (Decrease) (Decrease)
/Increase /Increase /Increase /Increase
RM’000
RM’000
RM’000
RM’000
Effects On Profit
After Taxation/
Equity
Increase of 100
basis points (bp)
(977)
(1,074)
(118)
–
Decrease of 100 bp
977
1,074
118
–
