/ . 9 8
E U R O S P O R T S G L O B A L L I M I T E D
Notes to
the F iNaNci al statemeNts
3 1 ma r ch 2 0 1 5
23 .
F i nanc i a l i n s t r umen t s : i n f o rma t i on on F i nanc i a l r i s k s ( Con t ’ d )
23E. Liquidity risk – Financial Liabilities maturity analysis (Cont’d)
The liquidity risk refers to the difficulty in meeting obligations associated with financial liabilities that are settled by
delivering cash or another financial asset. It is expected that all the liabilities will be paid at their contractual maturity.
Purchases of new automobiles are generally conducted on a cash on delivery basis and for purchase of new demo
automobiles, a credit period of 90 days may be granted. The average credit period taken to settle purchases of
automobile parts and accessories and other trade payables is about 30 days (2014: 30 days). The other payables are
with short-term durations. In order to meet such cash commitments, the operating activity is expected to generate
sufficient cash inflows. The classification of the financial assets is shown in the statement of financial position as they
may be available to meet liquidity needs and no further analysis is deemed necessary.
Financial guarantee contracts - For financial guarantee contracts the maximum earliest period in which the guarantee
amount can be claimed by the other party is used.
At the end of the reporting year no claims on the financial
guarantees are expected to be payable. The financial guarantee contracts relates to the corporate guarantees given by
the Company on the banking facilities of certain subsidiaries (Note 20).
bank facilities:
group
2015
$’000
2014
$’000
Undrawn borrowing facilities
34,323
34,955
The undrawn borrowing facilities are available for operating activities and to settle other commitments. Borrowing
facilities are maintained to ensure funds are available for the operations.
23F.
interest rate risk
The interest rate risk exposure is mainly from changes in floating interest rates and it mainly concerns financial liabilities.
The interest income from financial assets including cash balances is not significant. The following table analyses the
breakdown of the significant financial instruments (excluding derivatives) by type of interest rate:
group
2015
$’000
2014
$’000
Financial liabilities with interest:
Fixed rates
2,054
2,780
Floating rates
15,647
12,009
Total at end of the year
17,701
14,789
Financial assets with interest:
Fixed rates
5,360
15,360
The interest rates are disclosed in the respective notes.
Sensitivity analysis: The effect on pre-tax profit is not significant.
