notes to the financial statements 31 march 2025 (cont’d.) 35. Financial instruments (cont’d.) Financial risk management objectives and policies (cont’d.) Interest rate risk (cont’d.) Sensiঞvity analysis for interest rate risk During the financial year, if interest rates had been 10 basis points lower/higher, with all other variables held constant, the Group’s profit before tax would have been RM542,000 (2024: RM145,000) higher/lower respecঞvely, arising mainly as a result of lower/higher interest expense on floaঞng rate loans and borrowings. The assumed movement in basis points for interest rate sensiঞvity analysis is based on the currently observable market environment. Credit risk Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligaঞons. The Group’s exposure to credit risk in relaঞon to its trade and other receivables and intercompany balances, should all its customers fail to perform their obligaঞons as at 31 March 2025, is the carrying amount of these receivables as disclosed in the statements of financial posiঞon. In respect of trade receivables arising from sale of development properঞes, the Group miঞgates its credit risk by maintaining its name as the registered owner of the development properঞes unঞl full selement by the purchasers or the purchasers’ end-financiers. Furthermore, for property development in Malaysia, the developer has the opঞon to terminate the sale and purchase agreement in the event of default by the purchaser. The maximum exposure to credit risk is represented by the carrying amount of each financial assets in the statements of financial posiঞon. The Group’s main financial assets are its receivables. Ageing analysis is disclosed in Note 21. The Group does not have any significant credit risk exposure to any single counterparty or any group of counterparঞes having similar characterisঞcs, other than as disclosed in Note 21. The Group defines counterparঞes having similar characterisঞcs if they are related enঞঞes. The management of the Group monitors the cash flows and funding requirements of the Company and its subsidiaries on a Group-wide basis. This includes determining the ঞming and quantum of the repayment of amounts due from and due to subsidiaries and related companies of the Company when required. Liquidity risk The responsibility for liquidity risk management rests with management of the Group, which has established an appropriate liquidity risk management framework for the management of the Group’s short-term, medium and long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves and banking faciliঞes by conঞnuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabiliঞes. The following tables detail the liquidity analysis for its financial liabiliঞes based on the contractual maturity of these financial instruments. The tables have been drawn up based on the undiscounted cash flows of financial liabiliঞes based on the earliest contractual date on which the Group can be required to pay. 214 MATRIX CONCEPTS HOLDINGS BERHAD INTEGRATED ANNUAL REPORT 2025 07 FINANCIAL STATEMENTS
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