Report - Nikko AM Asia Limited

NIKKO AM SHENTON EIGHT PORTFOLIOS
(Constituted under a Trust Deed registered in the Republic of Singapore)
NOTES TO THE FINANCIAL STATEMENTS
For the financial year ended 31 December 2013
6. Financial risk management (continued)
(d)
Liquidity risk (continued)
Liabilities
Eight Portfolio E
Less than 3 months
As at
31 December
2013
As at
31 December
2012
S$ S$
Payables 103,234 141,283
Contractual cash outflows
(excluding gross settled
derivatives) 103,234 141,283
(e)
Credit risk
Credit risk is the risk that a counterparty will be unable to fulfil its obligations to the
Fund in part or in full as and when they fall due.
Concentrations of credit risk are minimised primarily by:
– ensuring counterparties as well as the respective credit limits are approved;
– ensuring there are controls in place to identify and assess the
creditworthiness of counterparties and reviews such controls on a
semi-annual basis; and
– ensuring that transactions are undertaken with a large number of
counterparties.
All trade settlement with approved counterparties are on Delivery versus Payment
and/or Receipt versus Payment basis;
Credit risk arises from cash and bank balances and fixed deposits. The table
below summarises the credit rating of banks and custodians in which the subfunds’
assets are held as at 31 December 2013 and 31 December 2012.
Eight Portfolio A
Credit rating
as at
31 December
2013
Credit rating
as at
31 December
2012
Source of credit
rating
Bank balance and Custodian
- BNP Paribas Securities Services
Singapore Branch A+ - Standard & Poor's
- The Northern Trust Company - A+ Standard & Poor's
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