SCC Holdings Berhad Annual Report 2019

notes to the financial statement 31 december 2019 (cont’d) 95 SCC Holdings Berhad | Annual Report 2019 31. Financial Instruments (Cont’d) (b) Financial risk management (cont’d) (iii) Market risks (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 RMNil (2018: RM1,000), 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 Level 1 Total fair value Carrying amount RM’000 RM’000 RM’000 Group 2019 Financial Assets Investment securities 72 72 72 Other investments 14,725 14,725 14,725 2018 Financial Assets Investment securities 66 66 66 Other investments 13,697 13,697 13,697