214 KIMLUN CORPORATION BERHAD • NOTES TO THE FINANCIAL STATEMENTS 200901023978 (867077-X) Kimlun Corporation Berhad (Incorporated in Malaysia) 35. Financial risk management objectives and policies (cont'd) (c) Interest rate risk (cont'd) Sensitivity analysis for interest rate risk (d) Foreign currency risk Sensitivity analysis for foreign currency risk 2025 2024 RM RM Increase/(decrease) in profit after tax SGD/RM - strengthened 5% (2024: 8%) 3,165,455 6,282,150 - weakened 5% (2024: 8%) (3,165,455) (6,282,150) USD/RM - strengthened 9% (2024: 11%) (230,589) (627,283) - weakened 9% (2024: 11%) 230,589 627,283 During the financial year, if interest rates had been 50 (2024: 50) basis points lower/higher, with all other variables held constant, the Group's net profit after tax would have increased/decreased by RM659,000 (2024: RM326,000) during the year. The assumed movement in basis points for interest rate sensitivity analysis was based on the prior year observable market environment. Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Group has transactional currency exposures arising from sales or purchases that are denominated in a currency other than RM, the functional currency of the Group's entities. The foreign currency in which these transactions are denominated is Singapore Dollar (“SGD”) and United States Dollar ("USD"). The Group did not enter into any forward currency contracts during the financial years ended 31 December 2025 and 2024. The following table demonstrates the sensitivity of the Group’s profit net of tax to a reasonably possible change in the SGD and USD exchange rates against RM, with all other variables held constant. - 94 -
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