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Notes to the financial statements
31 December 2014
Bursa Malaysia
•
Annual Report 2014
163
36. Financial risk management objectives and policies (cont’d.)
(d) Liquidity risk (cont’d.)
(ii) Clearing and settlement related risk (cont’d.)
The liabilities and corresponding assets in relation to clearing and settlement risk as at the financial year end are shown below:
On demand
Note
2014
2013
RM’000
RM’000
Group
Current assets
Cash for trading margins, security deposits and SBL collaterals
22
715,815
734,318
Cash and bank balances of Clearing Funds - Participants’ contribution
23
36,261
35,374
Current liabilities
Trade payables
(715,815)
(734,318)
Participants’ contribution to Clearing Funds
(36,261)
(35,374)
-
-
(e) Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations. The Group and the
Company are exposed to credit risk primarily from investment securities, staff loans receivable, trade receivables, other receivables which are financial
assets and cash and bank balances with financial institutions.
As at the current and previous financial year end, the Group and the Company’s maximum exposure to credit risk is represented by the carrying amount of
each class of financial assets recognised in the statements of financial position.
For investment securities and cash and bank balances with financial institutions, the Group and the Company minimise credit risk by adopting an
investment policy which allows dealing with counterparties with good credit ratings only. Receivables are monitored to ensure that exposure to bad debts
are minimised.