NOTES TO THE FINANCIAL STATEMENTS
For The Financial Period From 1 January 2014 To 31 March 2015 (Cont’d)
115
Datasonic Group Berhad
(Company No. 809759-X)
45. FINANCIAL INSTRUMENTS (CONT’D)
45.1 FINANCIAL RISK MANAGEMENT POLICIES (CONT’D)
(a) Market Risk (Cont’d)
(iii) Equity Price Risk
The Group does not have any quoted investment and hence is not exposed to
equity price risk.
(b) Credit Risk
The Group’s exposure to credit risk, or the risk of counterparties defaulting, arises mainly
from trade and other receivables. The Group manages its exposure to credit risk by the
application of credit approvals, credit limits and monitoring procedures on an ongoing
basis. For other financial assets (including cash and bank balances), the Group minimises
credit risk by dealing exclusively with high credit rating counterparties.
The Group establishes an allowance for impairment that represents its estimate of incurred
losses in respect of the trade and other receivables as appropriate. The main components
of this allowance are a specific loss component that relates to individually significant
exposures, and a collective loss component established for groups of similar assets in
respect of losses that have been incurred but not yet identified. Impairment is estimated
by management based on prior experience and the current economic environment.
(i)
Credit risk concentration profile
The Group’s major concentration of credit risk relates to the amounts owing by two
(2) customers which constituted approximately 87% of its trade receivables at the
end of the financial period.
(ii) Exposure to credit risk
As the Group does not hold any collateral, the maximum exposure to credit risk is
represented by the carrying amount of the financial assets at the end of the financial
period/year.
As the Group operates in Malaysia only, hence there is no exposure of credit risk for
trade receivables by geographical region.
