notes to the financial statements - Food Empire Holdings Limited

Food Empire Holdings Limited Annual Report 2012
NOTES TO THE FINANCIAL STATEMENTS (cont’d)
For the year ended 31 December 2012
37. Financial risk management objectives and policies (cont’d)
(b)
Liquidity risk (cont’d)
Within
1 year
Within 1 to 5
years
More than 5
years
Company
Total
US$’000 US$’000 US$’000 US$’000
2011
Amounts due from subsidiaries (non-trade) 5,889 – – 5,889
Cash and cash equivalents 116 – – 116
Trade and other payables (1,043) – – (1,043)
Amounts due to subsidiaries (non-trade) (21) – – (21)
Total net undiscounted financial assets 4,941 – – 4,941
(c)
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of the Group’s financial instruments will fluctuate because of
changes in market interest rates. The Group’s and the Company’s exposure to interest rate risk arises primarily from interestbearing
loans and borrowings. The Group monitors the interest rate on loans and borrowings closely to ensure that the loans
and borrowings are maintained at favorable rate.
The following table demonstrates the sensitivity of the Group’s profit net of tax to a reasonably possible change in interest
rate, with all other variables held constant.
Increase/
decrease in
basis points
Effect on
profit, net of
tax
US$’000
2012
Cash and cash equivalents +10 41
Amounts due from associates (non-trade) +100 260
Interest-bearing loans and borrowings +100 (129)
Other payables +100 (139)
2011
Cash and cash equivalents +10 32
Amounts due from associates (non-trade) +100 20
Interest-bearing loans and borrowings +100 (233)
139