Press Metal Aluminium Holdings Berhad SECTION 6 • FINANCIAL STATEMENTS 304 Notes to the Financial Statements 28. FINANCIAL INSTRUMENTS (CONT’D) 28.4 Credit risk (cont’d) Trade receivables and contract assets (cont’d) Recognition and measurement of impairment loss In managing credit risk of trade receivables, the Group manages its debtors and takes appropriate actions (including but not limited to legal actions) to recover long overdue balances. Generally, trade receivables will pay within 180 days. The Group’s debt recovery process is as follows: a) Above 90 days past due after credit term, the Group will start to initiate a structured debt recovery process which is monitored by the sales management team; and b) The Group will commence a legal proceeding against the customer who fails to pay after the Group initiates the debt recovery process. As the Group does not deal with a large pool of customers, the Group assessed the risk of loss of each customer individually based on their financial information, past trend of payments and external credit ratings, where applicable. All of these customers have low risk of default, except for those which have been credit impaired. The following table provides information about the exposure to credit risk and expected credit losses for non-related party trade receivables and contract assets which are grouped together as they are expected to have similar risk nature. Group Gross carrying amount RM’000 Loss allowance RM’000 Net balance RM’000 2024 Current (not past due) 1,037,978 - 1,037,978 1 - 90 days past due 407,255 - 407,255 More than 90 days past due 11,382 - 11,382 1,456,615 - 1,456,615 Credit impaired Individually impaired 13,243 (13,243) - 1,469,858 (13,243) 1,456,615 Trade receivables 1,469,858 (13,243) 1,456,615 2023 Current (not past due) 808,961 - 808,961 1 - 90 days past due 475,989 - 475,989 More than 90 days past due 27,112 - 27,112 1,312,062 - 1,312,062 Credit impaired Individually impaired 14,563 (14,563) - 1,326,625 (14,563) 1,312,062 Trade receivables 1,326,625 (14,563) 1,312,062
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