258 MKH BERHAD | ANNUAL REPORT 2023 43. FINANCIAL INSTRUMENTS Categories of financial instruments The following table analyses the financial assets and financial liabilities in the statements of financial position by the class of financial instruments to which they are assigned, and therefore by the measurement basis: The Group The Company 2023 2022 2023 2022 RM RM RM RM Financial assets At FVTPL: Other investment 756,237 775,849 - - Short-term placements 63,670,729 86,365,216 - 4,541,682 At amortised cost: Receivables and deposits 208,188,391 186,154,468 79,496,728 68,809,762 Cash, bank balances, and term deposits 302,115,289 304,886,228 1,416,743 2,466,373 Financial liabilities At amortised cost: Payables and accruals 864,820,179 945,201,067 11,224,312 843,611 Lease liability 19,683,381 19,384,155 - - Loans and borrowings 359,609,949 401,298,526 125,100,000 150,200,000 44. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES The Group’s financial risk management policy seeks to ensure that adequate financial resources are available for the development of the Group’s businesses whilst managing its risks. The Group operates within clearly defined guidelines that are approved by the Board and the Group’s policy is not to engage in speculative transactions. The main risks and corresponding management policies arising from the Group’s normal course of business are as follows: (i) Credit risk Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations. The Group’s and the Company’s exposure to credit risk primarily arises from the receivables. For other financial assets, the Group minimizes credit risk by dealing with high credit rating counterparties. The maximum risk associated with recognized financial assets is the carrying amounts as presented in the statements of financial position and corporate guarantee provided by the Company to banks on subsidiaries’ credit facilities. NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2023
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