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Notes to the financial statements
31 December 2014
Bursa Malaysia
•
Annual Report 2014
174
39. Capital management
The Group manages its capital with the objective of maximising shareholders returns. To achieve this, the Group takes into consideration and ensures the
sufficiency of funds for operations, risk management and development. Although the Group’s policy is to distribute at least 75% of its profits to shareholders, it
has been able thus far to distribute at least 90% of its profits every year whilst ensuring that its pool of funds for future development is at a sufficient level.
The Group is not subject to any externally imposed capital requirements. However, the Group is required to set aside funds for the CGF and DCF in accordance
with the business rules of its clearing house subsidiaries.
Total capital managed at Group level, which comprises shareholders’ funds and deferred capital grants, stood at RM753,893,000 (2013: RM818,919,000) as at
the end of the respective financial year.
There has been no change in the above capital management objectives, policies and processes compared to the previous year.
40. Segment information
(a) Reporting format
For management reporting purposes, the Group is organised into operating segments based on market segments as the Group’s risks and rates of return
are affected predominantly by the macro environment of the different markets.
The securities, derivatives and others market segments are managed by the respective segment divisional heads responsible for the performance of the
respective segments under their charge.
(b) Market segments
The four major market segments of the Group are as follows:
(i) The securities market mainly comprises the provision and operation of the listing, trading, clearing, depository services and provision and dissemination
of information relating to equity securities quoted on exchanges for the securities market.
(ii) The derivatives market mainly comprises the provision and operation of the trading, clearing, depository services and provision and dissemination of
information relating to derivative products quoted on exchanges for the derivatives market.
(iii) The exchange holding business refers to the operation of the Company which functions as an investment holding company.
(iv) Others mainly comprises the provision of a Shari’ah compliant commodity trading platform, a reporting platform for bond traders and the provision of
an offshore market.
(c) Allocation basis and transfer pricing
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
Unallocated items comprise mainly corporate assets and liabilities, overheads and income tax expenses.
Management monitors the operating results of its market segments separately for the purpose of making decisions about resource allocation and
performance assessment.
Transfer prices between segments are set on an arm’s length basis in a manner similar to transactions with third parties.