DONACO INTERNATIONAL LIMITED 2018 ANNUAL REPORT 66 67 DONACO INTERNATIONAL LIMITED 2018 ANNUAL REPORT 67 66 NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2018 NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2018 NOTE 28. FINANCIAL INSTRUMENTS CONTINUED INTEREST RATE RISK The consolidated entity’s exposure to the risk of changes in market interest rates relates primarily to the consolidated entity’s bank loans and debt obligations and its cash and cash equivalents. The consolidated entity manages its interest rate risk by using a combination of variable and fixed rate borrowings. As at the reporting date, the consolidated entity had the cash and cash equivalents shown below. An analysis by remaining contractual maturities is shown in ‘liquidity and interest rate risk management’ below. An assessment of the sensitivity of the consolidated entity’s exposure to interest rate movements was performed, and was found to be immaterial for the purposes of this disclosure. CREDIT RISK Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the consolidated entity. The consolidated entity has a strict code of credit, including obtaining agency credit information, confirming references and setting appropriate credit limits. The consolidated entity obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements. The consolidated entity does not hold any collateral. LIQUIDITY RISK Vigilant liquidity risk management requires the consolidated entity to maintain sufficient liquid assets (mainly cash and cash equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable. The consolidated entity maintains cash to meet all its liquidity requirements and manages its liquidity by carefully monitoring cash outflows due in a day-to-day and week-to-week basis. Furthermore, the consolidated entity’s long-term liquidity needs are identified in its annual Board approved budget, and updated on a quarterly basis through revised forecasts. Remaining contractual maturities The following tables detail the consolidated entity’s remaining contractual maturity for its financial liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid. CONSOLIDATED WEIGHTED AVERAGE INTEREST RATE BALANCE WEIGHTED AVERAGE INTEREST RATE BALANCE 2018 2017 % $ % $ Bank loans 8.19 (70,401,487) 8.09 (108,462,225) Cash on hand and cash at bank 0.18 45,331,648 0.41 64,338,919 Fixed deposits 5.05 1,743,941 4.80 1,683,830 Net exposure to cash flow interest rate risk (23,325,898) (42,439,476) WEIGHTED AVERAGE INTEREST RATE 1 YEAR OR LESS BETWEEN 1 AND 2 YEARS BETWEEN 2 AND 5 YEARS OVER 5 YEARS TOTAL CONTRACTUAL MATURITIES Consolidated – 2018 % $ $ $ $ $ Non-derivatives Non-interest bearing Trade payables – 4,842,651 – – – 4,842,651 Floating chips – 6,624,856 – – – 6,624,856 Interest bearing – variable Bank loans 8.19 24,594,915 45,806,572 – – 70,401,487 Total non-derivatives 36,062,422 45,806,572 – – 81,868,994 WEIGHTED AVERAGE INTEREST RATE 1 YEAR OR LESS BETWEEN 1 AND 2 YEARS BETWEEN 2 AND 5 YEARS OVER 5 YEARS TOTAL CONTRACTUAL MATURITIES Consolidated – 2017 % $ $ $ $ $ Non-derivatives Non-interest bearing Trade payables – 4,472,103 – – – 4,472,103 Floating chips – 13,013,770 – – – 13,013,770 Interest bearing – variable Bank loans 8.09 54,908,598 53,553,627 – – 108,462,225 Total non-derivatives 72,394,471 53,553,627 – – 125,948,098 The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above. FAIR VALUE OF FINANCIAL INSTRUMENTS Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value. NOTE 29. KEY MANAGEMENT PERSONNEL DISCLOSURES DIRECTORS The following persons were directors of Donaco International Limited during the financial year: Stuart James McGregor Non-executive Director and Chairman Joey Lim Keong Yew Managing Director and CEO Benedict Paul Reichel Executive Director and Company Secretary Benjamin Lim Keong Hoe Non-executive Director Robert Andrew Hines Non-executive Director Ham Techatut Sukjaroenkraisri Executive Director (retired 23 November 2017) Paul Porntat Amatavivadhana Non-executive Director (resigned 3 July 2017) OTHER KEY MANAGEMENT PERSONNEL The following persons also had the authority and responsibility for planning, directing and controlling the major activities of the consolidated entity, directly or indirectly, during the financial year: Kenny Goh Kwey Biaw Deputy Chief Financial Officer and CEO of Donaco Singapore (retired 31 March 2018) Chong Kwong Yang Chief Financial Officer Att Asavanund Chief Operating Officer and Deputy CEO (resigned 31 August 2017) COMPENSATION The aggregate compensation made to directors and other members of key management personnel of the consolidated entity is shown below. CONSOLIDATED 2018 2017 $ $ Short-term employee benefits 2,744,060 3,148,000 Post-employment benefits 326,958 103,293 Share-based payments 259,516 196,804 3,330,534 3,448,097