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27. COMMITMENTS The Company leases office premises under operating lease arrangements. The minimum lease commitments under the operating lease agreements are as follows: KHR’000 2010 2009 US$ equivalent (Note 2.3.1) KHR’000 US$ equivalent (Note 2.3.1) Within one year 1,436,209 354,357 1,034,437 248,126 After one year but not more than five years 1,343,882 331,577 1,662,764 398,840 More than five years 330,996 81,667 - - 3,111,087 767,601 2,697,201 646,966 28. RELATED PARTY TRANSACTIONS AND BALANCES Related party transactions include all transactions undertaken with other parties to which the Company is related. Related parties, as defined in Article 49 and 50 of the Law on Banking and Financial Institutions, include the following: (a) any person holding directly or indirectly at least ten percent (10%) of capital or voting rights; (c) any individual who participates in the administration, direction, management or internal control; and (d) the external auditors. Significant transactions with related parties during the year, which were made at normal terms and conditions, and the resulting outstanding balances as at year end were as follows: (b) any company of which the Company directly or indirectly holds at least ten percent (10%) of the capital or voting rights; (i) Transactions with key management personnel of the Company: 2010 2009 KHR’000 US$ equivalent (Note 2.3.1) KHR’000 US$ equivalent (Note 2.3.1) Board of Directors’ mission 247,329 61,024 548,951 131,675 (ii) Transactions with other related parties: KHR’000 Interest expense 2010 31 December 2009 KHR’000 Outstanding balance KHR’000 Interest expense KHR’000 Outstanding balance FMO 1,772,594 11,076,167 2,767,243 16,436,000 Proparco 1,396,517 14,861,000 1,494,709 16,676,000 Oikocredit 771,105 6,734,017 963,615 5,268,034 GRET 46,972 360,128 78,155 1,082,967 3,987,188 33,031,312 5,303,722 39,463,001 63 Annual Report 2010 Microfinance Institution “Amret”
29. FINANCIAL RISK MANAGEMENT The Company’s activities are exposed to a variety of financial risks: credit risk, market risk (including currency risk, interest rate risk and price risk), and liquidity risk. Taking risk is core to the financial business, and operational risks are an inevitable consequence of being in business. In the absence of the derivates market in Cambodia, the Company does not use derivative financial instruments such as foreign exchange contract and interest rate swaps to manage its risk exposure. The Company intends to comply with NBC’s regulations for financial risk management purposes. All major financial risks have been identified, monitored and reviewed by the Board of Directors and the management. The Asset and Liability Management Committee has been established to formulate broad parameters of acceptable risk for the Company and monitor the activities against these parameters. The Company holds the following financial assets and liabilities: Financial assets KHR’000 2010 2009 US$ equivalent (Note 2.3.1) KHR’000 US$ equivalent (Note 2.3.1) Cash on hand 9,430,111 2,326,699 8,222,550 1,972,308 Balances with NBC 35,093,438 8,658,633 40,689,743 9,760,073 Balances with other banks 23,656,410 5,836,765 5,695,045 1,366,046 Placements with banks 7,092,750 1,750,000 18,856,495 4,523,025 Loans and advances - net 268,404,155 66,223,576 213,359,202 51,177,549 Other assets: Accrued interest receivable 5,066,191 1,249,985 4,473,901 1,073,135 Advances to staff 427,054 105,367 438,159 105,099 Accounts receivable 125,846 31,050 16,274 3,904 Deposits 62,905 15,521 114,536 27,473 Total financial assets 349,358,860 86,197,596 291,865,905 70,008,612 Financial liabilities Deposits from customers 61,559,853 15,188,713 12,208,997 2,928,519 Bank overdraft 7,825,257 1,930,732 - - Borrowings 176,529,581 43,555,288 197,853,999 47,458,383 Subordinated debt 4,032,971 995,058 4,032,971 967,371 Other liabilities: Accrued interest payable 3,655,911 902,026 2,464,474 591,143 Accrued commissions for credit committee 1,865,940 460,385 1,976,370 474,063 Accrued bonus/incentives 1,954,014 482,115 2,009,078 481,909 Payable to staff association 164,084 40,485 129,288 31,012 Accrued other operating expenses 116,212 28,673 187,522 44,980 Total financial liabilities 257,703,823 63,583,475 220,862,699 52,977,380 Net financial assets 91,655,037 22,614,121 71,003,206 17,031,232 Microfinance Institution “Amret” Annual Report 2010 64
Page 2 and 3:
Key Figures 2010 2009 2008 Number o
Page 4 and 5:
Vision and Mission Vision To be an
Page 6 and 7:
Shareholders Advans S.A. SICAR is a
Page 8 and 9:
Ms. Marjorie A. MARASIGAN, Filipino
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Milestones Amret, as a leading micr
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Furthermore, Amret had reformed our
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11 Annual Report 2010 Microfinance
Page 16 and 17: Public Sector Government Revenue (%
Page 18 and 19: Loan Portfolio ICBO in Riel 5.57 6.
Page 20 and 21: Risk Management 1- Organization to
Page 22 and 23: 4- Compliance Risk Amret has recent
Page 24 and 25: Organizational Chart, Staff, and St
Page 26 and 27: 23 Annual Report 2010 Microfinance
Page 28 and 29: v As part of social responsibility
Page 32 and 33: REPORT OF THE BOARD OF DIRECTORS Th
Page 34 and 35: No director of the Company has rece
Page 38 and 39: INCOME STATEMENT for the year ended
Page 40 and 41: STATEMENT OF CASH FLOWS for the yea
Page 42 and 43: 2.1.1 Presentation of financial sta
Page 44 and 45: to classify their loan portfolio in
Page 46 and 47: Deferred tax assets are recognized
Page 48 and 49: 5. BALANCES WITH OTHER BANKS KHR’
Page 50 and 51: (b) Grading of the loan portfolio a
Page 52 and 53: 8. OTHER ASSETS KHR’000 2010 2009
Page 56 and 57: 13. BORROWINGS 2010 2009 Note KHR
Page 58 and 59: 14. OTHER LIABILITIES KHR’000 201
Page 60 and 61: Number of shares Par value KHR’00
Page 62 and 63: 22. FEES AND COMMISSION EXPENSE KHR
Page 64 and 65: (ii) Reconciliation of the total in
Page 68 and 69: 29.1 Credit risk The Company takes
Page 70 and 71: In the absence of derivatives marke
Page 72 and 73: 30. INTEREST RATE RISK (continued)
Page 74 and 75: 31. LIQUIDITY RISK (continued) Up t
Page 76 and 77: FOR USE BY THE NATIONAL BANK OF CAM
Page 78 and 79: SUPPLEMENTARY FINANCIAL INFORMATION
Page 80 and 81: RESERVE REQUIREMENT In accordance w
Page 82 and 83: Allowance per NBC Allowance per Com
Page 84 and 85: Allowance per NBC Allowance per Com
Page 88 and 89: 2-7 Kroch Chhmar Branch Kroch Chhma
Page 90 and 91: Microfinance Institution “Amret
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