NOTES TO THE FINANCIAL STATEMENTS
For the Financial Year Ended 31 December 2014
40 FINANCIAL RISK MANAGEMENT (CONT’D)
(c)
Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on
its obligation. The credit risk arising from the Group’s normal commercial operations is controlled by individual
operating units within strict credit control and guidelines. Policies are in place to ensure on-going credit evaluation
and active account monitoring.
At the end of the reporting period, the Group’s and the Company’s maximum exposure to credit risk is represented
by the carrying amount of each class of financial assets recognised on the balance sheet.
Financial assets that are neither past due nor impaired
Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good payment
record with the Group. Cash and cash equivalents, investment/marketable securities and derivatives that are neither
past due nor impaired are placed with or entered into with reputable financial institutions or companies.
Credit risk concentration profile
The Group determines concentrations of credit risk by monitoring the country profile of its trade and other
receivables on an on-going basis. The credit risk concentration profile of the Group’s trade and other receivables
at the end of the reporting period is as follows:
Group
Company
2014
2013
2014
2013
$’000 % of total
$’000 % of total
$’000 % of total
$’000 % of total
By country:
Singapore
74,704
64
79,808
72
553,624
99
581,713
99
Malaysia
7,044
6
4,244
4
4,455
1
4,007
1
Indonesia
1,505
1
3,614
3
–
–
–
–
Australia
3,318
3
4,438
4
–
–
–
–
China, including Hong
Kong and Taiwan
4,203
4
3,911
4
–
–
–
–
South Africa
5,763
5
3,311
3
–
–
–
–
Germany
3,079
3
2,923
2
–
–
–
–
Other countries
16,474
14
8,974
8
–
–
–
–
116,090
100
111,223
100
558,079
100
585,720
100
Approximately 57% (2013: 61%) of the Group’s trade and other receivables were due from an associate located in
Singapore.
145
THE STRAITS TRADING COMPANY LIMITED ANNUAL REPORT 2014
