SCC Holdings Berhad Annual Report 2018

SCC Holdings Berhad | Annual Report 2018 .87 NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2018 (CONT’D) 30. Financial Instruments (cont’d) (b) Financial risk management objectives and policies (cont’d) (iii) Market risks (cont’d) (b) Interest rate risk (cont’d) Interest rate risk sensitivity analysis Fair value sensitivity analysis for fixed rate instruments The Group does not account for any fixed rate financial assets at fair value through profit or loss. Therefore, a change in market interest rates at the end of the reporting period would not affect profit or loss. Cash flow sensitivity analysis for floating rate instruments A change in 1% interest rate at the end of the reporting period would have increased/(decreased) the Company’s profit before taxation by RM1,270 (2017: RM2,760), arising mainly as a result of lower/higher interest expense on floating rate loans and borrowings. This analysis assumes that all other variables remain constant. The assumed movement in basis points for interest rate sensitivity analysis is based on the currently observable market environment. (c) Fair value of financial instruments The carrying amounts of receivables and payables, cash and cash equivalents and borrowings approximate their fair value due to the relatively short-term nature of these financial instruments and insignificant impact of discounting. The table below analyses financial instruments carried at fair value for which fair value is disclosed, together with their fair values and carrying amounts shown in the statements of financial position. Fair value of financial instruments carried at fair value Total fair Carrying Level 1 value amount RM’000 RM’000 RM’000 Group 2018 Financial Assets Investment securities 66 66 66 Other investments 13,697 13,697 13,697 2017 Financial Assets Investment securities 68 68 68 Other investments 14,324 14,324 14,324 Company 2018 Financial Asset Other investments 6,284 6,284 6,284 2017 Financial Asset Other investments 6,626 6,626 6,626