ENRA Group Berhad Annual Report 2021

FINANCIAL STATEMENTS & OTHERS ENRA Group Berhad | Annual Report 2021 138 NOTES TO THE FINANCIAL STATEMENTS 31 MARCH 2021 13. TRADE AND OTHER RECEIVABLES (cont’d) (a) Trade and other receivables (excluding prepayments) are classified as financial assets measured at amortised cost. (b) The credits term of the non-current trade receivables of the Group are in accordance with the repayment schedules as contained in the agreements. (c) Trade receivables are non-interest bearing and the normal trade credit terms granted by the Group and the Company range from 30 to 60 days (2020: 30 to 60 days). They are recognised at their original invoice amounts which represent their fair values on initial recognition. (d) The amounts due from subsidiaries represent advances and payments on behalf, which bear interest at 6% - 10% (2020: 6% - 12%) per annum and payable within next twelve months in cash and cash equivalents. In the previous financial year, the amount due from an associate represent advances and payments on behalf, which are interest free and payable within next twelve month in cash and cash equivalents. (e) The currency exposure profile of receivables (exclude prepayments) are as follows: Group Company 2021 2020 2021 2020 RM’000 RM’000 RM’000 RM’000 Ringgit Malaysia 5,204 59,992 42,827 27,263 US Dollar 7,101 11,417 10,302 10,302 British Pound 12 33 9,518 8,775 Australian Dollar 610 1,386 – – 12,927 72,828 62,647 46,340 (f) Impairment for trade receivables that do not contain a significant financing component are recognised based on the simplified approach using the lifetime expected credit losses. The Group uses an allowance matrix to measure the expected credit loss of trade receivables from individual customers. Expected loss rates are calculated using the average historical bad debts write-offs rate and general rate based on the length of time invoices are overdue. During this process, the probability of non-payment by the trade receivables is adjusted by forward looking information (gross domestic product (GDP)) and multiplied by the amount of the expected loss arising from default to determine the lifetime expected credit loss for the trade receivables. For trade receivables, which are reported net, such impairments are recorded in a separate impairment account with the loss being recognised within administrative expenses in the consolidated statement of profit or loss and other comprehensive income. On confirmation that the trade receivable would not be collectable, the gross carrying value of the asset would be written off against the associated impairment.