psc - Kufpec

KUWAIT FOREIGN PETROLEUM EXPLORATION COMPANY K.S.C. (CLOSED)
AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2010
24. FINANCIAL INSTRUMENTS (CONTINUED)
Credit risk management (Continued)
Exposure to credit risk (Continued)
The maximum exposure to credit risk for trade receivables at the reporting date by geographic region was:
Carrying amount
2010 2009
KD 000’s KD 000’s
Africa 12,176 9,089
Asia 47,277 23,816
Other regions 4,290 5,575
63,743 38,480
Liquidity risk management
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The
Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring
unacceptable losses or risking damage to the Group’s reputation.
Ultimate responsibility for liquidity risk management rests with the management, which has built an
appropriate liquidity risk management framework for the management of the Group’s short, medium and
long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining
adequate reserves and banking facilities, by continuously monitoring forecast and actual cash flows and
matching the maturity profiles of financial assets and liabilities. All the financial liabilities of the Group are
due within one year except the long-term loan. The long-term loan along with finance costs payable
amounting to KD 25,750 thousand will be re-paid in 2011. The long-term loan along with finance costs
payable amounting to KD 38,909 thousand will be re-paid in 2012 and 2013.
Fair value of financial instruments
Management believes that the fair value of all of the Group’s financial assets and financial liabilities are not
significantly different from their respective carrying values.
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