GHL System Berhad Annual Report 2018

a n n u a l r e p o r t 2 0 1 8 141 NOT ES TO THE F I NANC I A L STAT EMENTS 3 1 D e c e m b e r 2 0 1 8 C O N T ’ D 31. RELATED PARTIES DISCLOSURES (cont’d) (c) Compensation of key management personnel (cont’d) Other key management personnel have been granted the following number of options under the ESS during the financial year: Group and Company 2018 2017 As at 1 January - 3,800,000 Granted 7,900,000 - Resigned - - Exercised (80,000) (3,800,000) As at 31 December 7,820,000 - The terms and conditions of the share options are detailed in Note 23 to the financial statements. 32. CAPITAL AND FINANCIAL RISK MANAGEMENT (a) Capital management The primary objective of the capital management of the Group is to maintain a strong capital base and safeguard the ability of the Group to continue as a going concern whilst maintaining an optimal capital structure, so as to maximise shareholders value. The management reviews the capital structure by considering the cost of capital and the risks associated with the capital. No changes were made in the objectives, policies or procedures during the financial years ended 31 December 2018 and 31 December 2017. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividend paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. Total capital managed at Group level, which comprises shareholders’ funds, cash and cash equivalents and bank borrowings. The gearing ratios are as follows: Group Company 2018 2017 2018 2017 RM RM RM RM Total borrowings 34,667,861 34,186,239 229,981 296,639 Less: Cash and cash equivalents (133,122,885) (99,945,382) (52,531,904) (16,085,617) Net cash (98,455,024) (65,759,143) (52,301,923) (15,788,978) Total equity attributable to owners of the parent 406,225,050 274,195,392 175,665,115 76,624,819 Gearing ratio - - - -