EXCEL FORCE MSC BERHAD Annual Report 2018

114 ANNUAL REPORT 2018 32. Financial Instruments (cont’d) (b) Financial risk management objectives and policies (cont’d) (iii) Market risks (cont’d) (i) Interest rate risk (cont’d) The interest rate profile of the Group’s and of the Company’s significant interest-bearing financial instruments, based on carrying amount as at the end of the reporting period was: Group 2018 2017 RM RM Floating rate instruments Short term funds 26,149,369 14,734,445 Loan and borrowing - (4,240,002) 26,149,369 10,494,443 Fixed rate instrument Deposits with licensed banks 212,097 206,914 Company 2018 2017 RM RM Floating rate instruments Short term funds 26,149,369 14,734,445 Loan and borrowing - (4,240,002) 26,149,369 10,494,443 Fixed rate instruments Amount due from a subsidiary company 1,173,048 1,382,376 Deposits with licensed banks 212,097 206,914 1,385,145 1,589,290 Interest rate risk sensitivity analysis Fair value sensitivity analysis for fixed rate instruments The Group and the Company do not account for any fixed rate financial assets and liabilities at fair value through profit or loss. Therefore, a change in 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 Group’s and the Company’s profit before tax by RM261,494 and RM261,494 (2017: RM104,944 and RM104,944) respectively, arisingmainly as a result of higher/lower net interest on floating rate instruments. 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. Notes To The Financial Statements 31 December 2018 (cont’d)