101
NOTES TO THE FINANCIAL STATEMENTS
For the financial year ended 31 December 2014
28.
Financial risk management
(continued)
(c)
Liquidity risk
Prudent liquidity risk management includes maintaining sufficient cash and the availability
of funding through an adequate amount of committed credit facilities. At the balance sheet
date, assets held by the Group and the Company for managing liquidity risk included cash
and short-term bank deposits as disclosed in Note 11.
Management monitors rolling forecasts of the Group’s and Company’s liquidity reserve and
cash and cash equivalents (Note 11) on the basis of expected cash flow. This is generally
carried out at local level in the operating entities of the Group in accordance with the practice
and limits set by the Group. These limits vary by operating entity to take into account the
working capital requirement of each entity. In addition, the Group’s liquidity management
policy involves projecting cash flows and considering the level of liquid assets necessary to
meet these, monitoring liquidity ratios and maintaining debt financing plans.
The table below analyses non-derivative financial liabilities of the Group and the Company
into relevant maturity groupings based on the remaining period from the balance sheet date
to the contractual maturity date. The amounts disclosed in the table are the contractual
undiscounted cash flows. Balances due within 12 months equal their carrying amounts as the
impact of discounting is not significant.
Less than
1 year
Between
1 and 2
years
Between
2 and 5
years
Over
5 years
$’000
$’000
$’000
$’000
Group
At 31 December 2014
Trade and other payables
(25,562)
(1,375)
(2,350)
–
Borrowings
(70,013)
(71,917)
(16,042)
(18,246)
At 31 December 2013
Trade and other payables
(43,201)
(2,750)
(2,350)
–
Borrowings
(28,407)
(17,243)
(73,161)
(14,979)
Company
At 31 December 2014
Trade and other payables
(53,719)
(1,375)
(2,350)
–
Borrowings
–
(52,009)
–
–
Financial guarantees
(20,388)
–
–
–
At 31 December 2013
Trade and other payables
(16,229)
(2,750)
(2,350)
–
Borrowings
–
(2,875)
(52,009)
–
Financial guarantees
(3,016)
–
–
–
(d)
Capital risk
The Group’s objectives when managing capital are to safeguard the Group’s ability to
continue as a going concern and to maintain an optimal capital structure so as to maximise
shareholder value. In order to maintain or achieve an optimal capital structure, the Group
may adjust the amount of dividend payment, return capital to shareholders, issue new shares,
buy back issued shares, obtain new borrowings or sell assets to reduce borrowings.
Management monitors capital based on debt to equity ratio. The Group and the Company
are also required by the banks to maintain debt to equity ratio not exceeding 1.50 times. The
Group’s and the Company’s strategies which were unchanged from 2013 are to maintain debt
to equity ratio within 1.50 times.
