7 195 194 Notes to the Financial Statements Notes to the Financial Statements 30. FINANCIAL INSTRUMENTS (CONTINUED) 30.1 Categories of financial instruments (continued) Carrying amount RM’000 AC RM’000 Mandatorily at FVTPL RM’000 Derivatives used for hedging RM’000 2022 Financial assets Group Derivative financial assets 4,281 - - 4,281 Trade and other receivables, excluding advances to suppliers 486,153 486,153 - - Cash and cash equivalents 481,131 455,949 25,182 - 971,565 942,102 25,182 4,281 Company Derivative financial assets 4,106 - - 4,106 Trade and other receivables 545,784 545,784 - - Cash and cash equivalents 14,915 14,230 685 - 564,805 560,014 685 4,106 Financial liabilities Group Loans and borrowings (1,360,395) (1,360,395) - - Derivative financial liabilities (490) - (441) (49) Trade and other payables (468,594) (468,594) - - (1,829,479) (1,828,989) (441) (49) Company Loans and borrowings (641,834) (641,834) - - Trade and other payables (172,657) (172,657) - - (814,491) (814,491) - - 30.2 Net losses and gains arising from financial instruments Group Company 2023 RM’000 2022 RM’000 2023 RM’000 2022 RM’000 Net (losses)/gains on: Financial liabilities at amortised cost (66,687) (44,323) (25,091) (24,287) Financial assets at amortised cost 1,751 13,414 33,645 41,266 Financial assets at FVTPL 184 88 183 85 Financial liabilities at FVTPL 198 552 - - (64,554) (30,269) 8,737 17,064 30. FINANCIAL INSTRUMENTS (CONTINUED) 30.3 Financial risk management The Group and the Company have exposure to the following risks from its financial instruments: - Credit risk - Liquidity risk - Market risk 30.4 Credit risk Credit risk is the risk of a financial loss if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group’s exposure to credit risk arises principally from the individual characteristics of each customer. The Company’s exposure to credit risk arises principally from loans and advances to subsidiaries and financial guarantees given to banks for credit facilities granted to subsidiaries. There are no significant changes as compared to prior periods. Trade receivables and contract assets Risk management objectives, policies and processes for managing the risk Credit risk is controlled by the application of credit approvals, limits and monitoring procedures. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount. The Group does not have any significant exposure to any individual counterparty. The Group has credit policy in place to ensure that transactions are conducted with creditworthy counterparty. At each reporting date, the Group assesses whether any of the trade receivables and contract assets are credit impaired. The gross carrying amounts of credit impaired trade receivables and contract assets are written off (either partially or full) when there is no realistic prospect of recovery. This is generally the case when the Group determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off. Nevertheless, trade receivables and contract assets that are written off could still be subject to enforcement activities. There are no significant changes as compared to previous year. Exposure to credit risk, credit quality and collateral As at the end of the reporting period, the maximum exposure to credit risk arising from trade receivables and contract assets is represented by the carrying amounts in the statements of financial position. A significant portion of these receivables are regular customers that have been transacting with the Group. The Group uses aging analysis to monitor the credit quality of the receivables.
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