PRG Holdings Berhad Annual Report 2017

• PRG HOLDINGS BERHAD 144 32. FINANCIAL INSTRUMENTS (CONT’D) (a) Capital management (cont’d) The Group monitors capital using a gearing ratio, which is net debt divided by total capital. The Group regularly reviews the gearing ratio to ensure they are at acceptable levels and within industry norms. Net debts are calculated as total borrowings less cash and bank balances. Capital represents equity attributable to the owners of the parent. A detailed calculation of the net debt is shown below: Group Company 2017 2016 2017 2016 RM’000 RM’000 RM’000 RM’000 Borrowings 28,569 50,952 - 455 Less: Cash and bank balances (42,023) (20,504) (128) (224) Net (cash)/debt (13,454) 30,448 (128) 231 Total capital 135,780 123,902 141,622 105,921 Gearing ratio # 25% # * * Amount is less than 1% # Not applicable as the Group and the Company are in a net cash position Pursuant to the requirements of Practice Note No. 17/2005 of the Bursa Malaysia Securities Berhad, the Group is required to maintain a consolidated shareholders’ equity equal to or not less than the 25% of the issued and paid-up capital (excluding treasury shares) and such shareholders’ equity is not less than RM40,000,000. The Group has complied with this requirement during the financial year ended 31 December 2017. (b) Categories of financial instruments Group 2017 2016 RM’000 RM’000 Financial assets Loans and receivables Trade and other receivables, net of deposits for land acquisition, prepayments and amounts due from customers for contract works 83,325 25,725 Cash and bank balances 42,023 20,504 125,348 46,229 Financial liabilities Other financial liabilities Trade and other payables, net of amounts due to customers for contract works and progress billings in respect of property development costs 141,698 94,007 Borrowings 28,569 50,952 170,267 144,959 N O T E S T O T H E F I N A N C I A L S T A T E M E N T S 3 1 D E C E M B E R 2 0 1 7 ( c o n t ’ d )