ANNUAL REPORT 2008 - KNM Steel Sdn Bhd

NOTES TO THE
FINANCIAL STATEMENTS (CONT’D)
28. Financial instruments (cont’d)
Financial risk management objectives and policies (Cont’d)
Fair values (Cont’d)
The nominal value of the derivatives is as follows:
2008 2007
RM’000 RM’000
Forward foreign exchange contracts 695,713 632,033
Estimation of fair values
The following summarises the methods used in determining the fair values of financial instruments reflected
in the table.
Forward foreign exchange contracts are marked to market using listed market prices.
29. Segment information
Segment information is presented by geographical locations that the Group operates in. The format of the
geographical segments is based on the Group’s operation management and internal reporting structure. Intersegment
pricing is determined based on arms length transactions.
The Group is involved mainly in the business of designing and manufacturing process equipment for oil, gas,
petrochemicals, minerals processing, desalination, renewable energy, environmental and power industries.
Accordingly, segmental reporting by business is not applicable.
Reporting on segmental results, assets and liabilities include items directly attributable to geographical segments
as well as those that can be allocated on a reasonable basis. Unallocated items mainly comprise of interest
earning assets and related revenue, interest bearing loans, borrowings and related expenses, and tax assets
and liabilities.
Segment capital expenditure is the total cost incurred during the period to acquire segment assets that are
expected to be used for more than one period.
The segments are classified into geographical presence as follows:
Geographical segment
Asia & Oceania
Europe & America
Countries
Malaysia, the People’s Republic of China, India, Brunei Darussalam,
Indonesia and Australia
British Virgin Islands, United Arab Emirates, Kingdom of Saudi Arabia,
Canada, Brazil, Italy, United States of America and Germany
KNM GROUP BERHAD
104
ANNUAL REPORT 2008