NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2023 CONT’D 32. CAPITAL AND FINANCIAL RISK MANAGEMENT (Cont’d) (b) Financial risk management (Cont’d) (iii) Interest rate risk (Cont’d) The Directors were of the opinion that the Group and the Company were not subject to significant exposure to interest rate risk as the changes in market interest rates were insignificant. The interest profile and sensitivity analysis of interest rate risk have been disclosed in Notes 22 and 25. (iv) Price risk Price risk is the risk that the fair value of future cash flows of the financial instruments of the Group and of the Company would fluctuate because of changes in market prices (other than interest or exchange rates). The Group and the Company is exposed to price risks arising from investment held by the Group and the Company. The investment comprises mainly unquoted unit trusts in Malaysia. During the financial year, the maximum exposure of the Group and of the Company to market risk is represented by the total carrying amount of the investment recognised in the statements of financial position, which amounted to RM6,272,991 (2022: RM14,927,477) and RM6,264,741 (2022: RM9,951,410) respectively. There has been no change to the exposure of the Group and of the Company to market risk or the manner in which the risk is managed and measured. As the other investment are mainly cash funds or money market placement where the risk of analysis in value is insignificant, the Directors were of the opinion that the Group and the Company were not subject to significant exposure to price risk and accordingly, no sensitivity analysis was being presented at the end of each financial year. (v) Foreign currency risk Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument would fluctuate because of changes in foreign exchange rates. Subsidiaries operating in Australia, Singapore, Philippines and Thailand have assets and liabilities together with expected cash flows from anticipated transactions denominated in foreign currencies that give rise to foreign exchange exposures. The Group also hold cash and cash equivalents denominated in foreign currencies for working capital purposes. The sensitivity analysis for foreign currency risk has been disclosed in Notes 13, 20, 22, 25, 26 and 27 respectively. 33. MATERIAL LITIGATION On 25 September 2019, a subsidiary, GHL ePayments Sdn. Bhd. (“eGHL” or “Defendant”) had been served with a sealed Writ of Summons together with Statement of Claim both dated 19 September 2019 (“Writ”) by Messrs. Shukor Baljit & Partners, the solicitors acting for Bestinet Sdn Bhd (“Plaintiff”). The Plaintiff alleges that the Defendant has misrepresented and breached the contract with respect to the development, management and maintenance of digital wallet. As a result of that, the Plaintiff suffers loss and claims for the judgment sum of RM371,000, general damages of RM3,362,492 and other costs and interests. On 30 October 2019, the Defendant had filed Statement of Defence and Counterclaim against the Plaintiff, which the Plaintiff had, on 20 November 2019, served on eGHL with its Reply and Defence to Counterclaim. On 30 May 2022, the Kuala Lumpur High Court had decided that the Plaintiff’s claim be dismissed and the Defendant’s counterclaim was allowed. Subsequently, the Plaintiff submitted a Notice of Appeal dated 24 June 2022. 159 ANNUAL REPORT 2023
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