NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2025 (CONT’D) 37. FINANCIAL INSTRUMENTS (CONT’D) 37.1 FINANCIAL RISK MANAGEMENT POLICIES (CONT’D) (b) Credit Risk The exposure to credit risk, or the risk of counterparties defaulting, arises mainly from trade and other receivables. The Group manages its exposure to credit risk by the application of credit approvals, credit limits and monitoring procedures on an ongoing basis. For other financial assets (including cash and bank balances and derivatives), the Group minimises credit risk by dealing exclusively with high credit rating counterparties. Also, the Company’s exposure to credit risk includes loans and advances to subsidiaries, and corporate guarantee given to financial institution for credit facility granted to certain subsidiary. The Company monitors the ability of the subsidiaries to serve their loans on an individual basis. (i) Credit Risk Concentration Profile At the end of the reporting period, the Group’s major concentration of credit risk relates to the amounts owing by 4 (2024 - 3) customers which constituted approximately 59% (2024 - 61%) of its trade receivables, net of loss allowance. (ii) Maximum Exposure to Credit Risk At the end of the reporting period, the maximum exposure to credit risk is represented by the carrying amount of each class of financial assets recognised in the statement of financial position of the Group after deducting any allowance for impairment losses (where applicable). In addition, the Company’s maximum exposure to credit risk also includes corporate guarantee provided to its subsidiaries of approximately RM24,843,000 (2024 - Nil), representing the outstanding banking facility of the subsidiary as at the end of the reporting period. This corporate guarantee has not been recognised in the Company’s financial statements since its fair value on initial recognition was not material. 224 KEYFIELD INTERNATIONAL BERHAD (Incorporated in Malaysia) | Registration No: 202001038989 (1395310 - M)
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