TAN CHONG MOTOR HOLDINGS BERHAD
Annual Report 2014
119
NOTES TO THE FINANCIAL STATEMENTS
33. Financial instruments (continued)
33.6 Market risk (continued)
33.6.1 Currency risk (continued)
Exposure to foreign currency risk
The Group’s exposure to foreign currency (a currency which is other than the functional currencies of the
Group entities) risk, based on carrying amounts as at the end of the reporting period was:
2014
2013
Denominated in
Denominated in
USD
JPY
USD
JPY
RM’000
RM’000
RM’000
RM’000
Group
Trade receivables
768
1,520
3,835
-
Intra-group balances
(140,967)
-
(74,199)
-
Cash and cash equivalents
1,016
38
5,781
6,089
Payables and accruals
(7)
-
(17)
(39)
Borrowings
(100,285)
-
(62,767)
-
Derivative assets
-
-
-
36
Net exposure
(239,475)
1,558
(127,367)
6,086
Currency risk sensitivity analysis
A simulated 5% strengthening in the USD/JPY against Ringgit at the end of the reporting period would
have increase/(decrease) equity and post-tax profit or loss by the amounts shown below. The analysis
assumes that all other var
i
ables in particular interest rates and market conditions remained constant and
ignores any impact of forecsted sales and purchases.
2014
2013
Equity
Profit
or loss
Equity
Profit
or loss
RM’000
RM’000
RM’000
RM’000
USD
(8,980)
(8,980)
(4,776)
(4,776)
JPY
58
58
228
228
A simulated 5% weakening of USD/JPY against the Ringgit at the end of the reporting period would have
had equal but opposite effect on the above currencies to the amounts shown above, on the basis that all
other variables remained constant.
33.6.2 Interest rate risk
The Group’s exposure to interest rate risk arises from interest-bearing borrowings and the placement
of excess funds in interest-earning deposits. The borrowings which have been obtained to finance the
working capital of the Group are subject to floating interest rates except for Medium Term Notes and term
loans from certain commercial banks which are fixed with tenure ranging from 36 to 84 months.
