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AEMULUS HOLDINGS BERHAD
A N N U A L R E P O R T 2 0 1 6
27. FINANCIAL INSTRUMENTS (Cont’d)
27.2 Financial risk management (Cont’d)
27.2.3 Foreign currency risk
The objectives of the Group’s foreign exchange policy are to allow the Group to manage exposures that
arise from trading activities effectively within a framework of controls that does not expose the Group to
unnecessary foreign exchange risks.
The Group is exposed to foreign currency risk mainly on sales and purchases that are denominated in
a currency other than the Group’s functional currency. The Group also holds cash and bank balances
denominated in foreign currencies for working capital purposes The currencies giving rise to this risk are
primarily US Dollar (“USD”), Singapore Dollar (“SGD”) and New Taiwan Dollar (“TWD”).
The Group’s exposure to foreign currency risk, based on carrying amounts as at the end of the reporting
period is as follows:
Denominated in
USD
SGD
TWD
OTHERS
RM
RM
RM
RM
GROUP
30.9.16
Trade receivables
9,537,538
20,082
–
–
Cash and bank balances
1,344,118
182,193
39,452
–
Trade payables
(1,217,546)
–
–
–
Other payables
–
–
(64,384)
–
Net exposure
9,664,110
202,275
(24,932)
–
30.9.15
Trade receivables
6,471,340
–
–
–
Cash and bank balances
4,619,773
137,403
–
–
Trade payables
(3,275,606)
(3,119)
–
(42,598)
Other payables
(112,872)
–
–
–
Net exposure
7,702,635
134,284
–
(42,598)
Sensitivity analysis for foreign currency risk
The following table demonstrates the sensitivity to a reasonably possible change in the foreign currency
exchange rates against Ringgit Malaysia, with all other variables held constant, of the Group’s profit before
taxation. A 10% strengthening of the RM against the following currencies at the end of the reporting
period would have decrease profit before taxation by the amount shown below and a corresponding
weakening would have an equal but opposite effect.
GROUP
30.9.16
30.9.15
RM
RM
USD
(966,411)
(770,264)
SGD
(20,228)
(13,428)
TWD
2,493
–
Others
–
4,260
Decrease in profit before taxation
(984,146)
(779,432)
NOTES TO THE FINANCIAL STATEMENTS
(Cont’d)
– 30 SEPTEMBER 2016