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financiAL STATEMENTs
Annual Report 2017
161
NOTES TO THE FINANCIAL STATEMENTS
35. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONT’D.)
(b) Foreign Exchange Risk (Cont’d.)
Sensitivity analysis
The following table demonstrates the sensitivity of the Group’s profit net of tax to a reasonably possible change in the
Indonesian Rupiah (“IDR”) exchange rates against the functional currency of the affected group companies (“RM”) with all
other variables held constant.
The carrying amounts of the Group’s financial assets and liabilities denominated in foreign currency are as follows:
2017
2016
RM’000
RM’000
IDR
Assets
- Trade and other receivables
27,796
21,841
- Cash and cash equivalents
51,797
18,427
79,593
40,268
Liabilities
- Trade and other payables
13,662
7,843
Group
2017
2016
Effect on Effect on
profit
profit
net of tax net of tax
RM’000
RM’000
IDR - strengthens 5% (2016: 5%)
+2,506
+1,232
IDR - weakens 5% (2016: 5%)
-2,506
-1,232
(c) Liquidity/Funding Risk
The Group defines liquidity/funding risk as the risk that funds will not be available to meet its liabilities as and when they
fall due.
The Group actively manages its operating cash flows and the availability of funding so as to ensure that all funding needs
are met. As part of its overall prudent liquidity management, the Group maintains sufficient levels of cash or cash convertible
instruments to meet its working capital requirements. To ensure availability of funds, the Group closely monitors its cash
flow position on a regular basis.