Financial Statements Financial Statements Press Metal Aluminium Holdings Berhad 284 285 Integrated Annual Report 2023 Notes to the Financial Statements Notes to the Financial Statements 28. FINANCIAL INSTRUMENTS (CONT’D) 28.6 Market risk Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and other prices that will affect the Group’s financial position or cash flows. 28.6.1 Currency risk The Group is exposed to foreign currency risk on sales, purchases, cash and cash equivalents, derivatives and borrowings that are denominated in a currency other than the respective functional currencies of Group entities. The currencies giving rise to this risk are primarily Australian Dollar (“AUD”), Renminbi (“RMB”), Singapore Dollar (“SGD”), U.S. Dollar (“USD”), Euro (“EUR”) and Great Britain Pound (“GBP”). Risk management objectives, policies and processes for managing the risk The Group actively monitors its exposure to foreign currency risk and uses forward exchange contracts and cross currency swaps to mitigate the risk when the need arises. Some of the forward exchange contracts and cross currency swaps have maturities of more than five years after the end of the reporting period. Where necessary, the forward exchange contracts are rolled over at maturity. 28. FINANCIAL INSTRUMENTS (CONT’D) 28.6 Market risk 28.6.1 Currency risk (cont’d) Exposure to foreign currency risk The Group’s exposure to foreign currency (a currency which is other than the functional currency of the Group entities) risk, based on carrying amounts as at the end of the reporting period is as follows: Group Functional currency Foreign currency RM AUD RM’000 RM RMB RM’000 RM USD RM’000 RM EUR RM’000 RM RMB RM’000 RMB USD RM’000 RMB EUR RM’000 RMB GBP RM’000 AUD USD RM’000 AUD RM RM’000 USD RMB RM’000 GBP MYR RM’000 2023 Balances recognised in the statement of financial position Trade and other receivables 20,779 124,694 775,504 70,810 - 6,009 1,020 - - - - - Cash and cash equivalents 157,340 84,683 443,572 117,152 - 1,103 669 1,260 - - - - Loans and borrowings - - (1,048,412) - - - - - - - - - Trade and other payables (61,518) (37,299) (235,365) - - - - (5,620) - - - - 116,601 172,078 (64,701) 187,962 - 7,112 1,689 (4,360) - - - - Forecast transaction Net derivative assets - Cross currency swaps - - 2,385,000 - - - - - - - - - Forecast loan repayment - - (2,385,000) - - - - - - - - - Net derivative liabilities - Commodity swaps and options - - 4,067,889 - - - - - - - - - Net derivative assets - Forward exchange contracts on forecast sales - - 15,593,983 - 13,077 - - - 140,511 15,691 745,261 22,383 Forecast sales - - (19,584,663) - (13,077) - - - (140,511) (15,691) (745,261) (22,383) - - 77,209 - - - - - - - - - Net exposure 116,601 172,078 12,508 187,962 - 7,112 1,689 (4,360) - - - -
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