We aim to be the most preferred non-life insurer in Thailand

Foreign Currency Risk
The Company’s exposure to foreign currency risk arises mainly from foreign currency denominated underwriting,
reinsurance with foreign reinsurers and investments in foreign associates that are denominated in foreign currencies. The
Company does not utilise forward foreign currency contracts to mitigate its exposure to foreign currency risk.
As at December 31, 2009, the balances of financial assets and liabilities denominated in foreign currencies are
summarised below.
Foreign Currency Financial Financial Average Exchange Rate
Assets Liabilities as at December 31, 2009
(Million) (Million) (Baht per 1 foreign currency unit)
US dollar 7.8 7.1 33.3197
Philippines pesos 1.7 4.4 0.7143
Japanese yen 0.7 0.1 0.3617
HK dollar 1.9 - 4.2937
Indonesia rupiahs 1,678.0 - 0.0035
25.2 Fair value
A fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable,
willing parties in an arm’s length transaction. The fair value is determined by depending on the nature of the instrument.
The fair value is determined by reference to the market price of the financial instrument or by using an appropriate
valuation technique if the appropriate market price cannot be determined, depending on the nature of the instrument.
The following methods and assumptions were used by the Company in estimating the fair values of financial
instruments.
- Investment in securities
The fair value of equity securities and debt securities are based on their quoted market prices.
The fair value of other securities and investments in associates cannot be properly calculated, and therefore
no disclosure is made.
The fair value of deposits at financial institutions, and notes with maturity periods of less than 90 days is based
on their carrying value. For those with maturity periods longer than 90 days, fair value is estimated using a
discounted cash flow analysis based on the current interest rate and the remaining period to maturity.
- Secured loans
For floating interest rate loans with no significant credit risk, fair value is based on carrying value. The fair value
of fixed interest rate loans is estimated using a discounted cash flow analysis based on the current interest rate.
26. Capital Management
The primary objectives of the Company’s capital management are to maintain the Company’s ability to continue as a going
concern and to maintain capital reserve in accordance with Notifications of the Office of Insurance Commission.
27. Approval of Financial Statements
These financial statements were authorised for issue by the Company’s Executive Directors on February 17, 2010.
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