Dagang NeXchange Berhad Annual Report 2018

30. FINANCIAL INSTRUMENTS (CONTINUED) 30.6 Market risk Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and other prices will affect the Group’s financial position or cash flows. 30.6.1 Foreign currency risk The Group is exposed to foreign currency risk on sales and purchases that are denominated in the currency other than the functional currency, Ringgit Malaysia (“RM”). The currencies giving rise to this risk are primarily United States Dollar (“USD”), Euro, British Pound Sterling (“GBP”) and Singapore Dollar (“SGD”). Risk management objectives, policies and processes for managing the risk The Group does not have a fixed policy to hedge its sales and purchases via forward contracts. However, the exposure to foreign currency risk is monitored from time to time by management. Exposure to foreign currency risk The Group’s and the Company’s exposure to foreign currency risk, based on carrying amounts as at the end of the reporting period are as follows: Denominated in USD Euro GBP SGD Total Group RM’000 RM’000 RM’000 RM’000 RM’000 2018 Balances recognised in the statement of financial position Other investments 4,633 - - - 4,633 Trade and other receivables 42,967 - - 224 43,191 Cash and cash equivalents 104 - 3 - 107 Trade and other payables (23,090) (701) (1,682) - (25,473) Net exposure 24,614 (701) (1,679) 224 22,458 2017 Balances recognised in the statement of financial position Other investments 4,233 - - - 4,233 Trade and other receivables 5,562 5 1,112 570 7,249 Cash and cash equivalents 296 161 895 - 1,352 Trade and other payables (13,680) (1,091) (3,164) (304) (18,239) Net exposure (3,589) (925) (1,157) 266 (5,405) 170 Dagang NeXchange Berhad Annual Report 2018 Notes to the Financial Statements (CONTINUED)