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On Top of Our Game 82
Financial Statements
Notes to Financial Statements
31 March 2014
4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)
(b) Financial risk management policies and objectives
The Commission is exposed to financial risk arising from its operations which include interest rate risk,
credit risk and liquidity risk. The Commission has policies and guidelines, which set out its general risk
management framework as discussed below.
There has been no change to the Commission’s exposure to these financial risks or the manner in which
it manages and measures the risk.
(i)Interest rate risk management
Surplus funds in the Commission are placed with Accountant-General’s Department as disclosed
in Note 6. Interest rate sensitivity analysis has not been presented as management do not expect
any reasonable possible changes in interest rates to have a significant impact on the Commission’s
operations and cash flows.
(ii)Credit risk management
Credit risk, or the risk of counterparties defaulting are controlled by the application of regular monitoring
procedures. The extent of the Commission’s credit exposure is represented by the aggregate balance
of cash and bank balances and receivables.
(iii)Liquidity risk management
Liquidity risk arises in the general funding of the Commission’s operating activities. It includes the
risks of not being able to fund operating activities in a timely manner. To manage liquidity risk, the
Commission places surplus funds with the Accountant-General’s Department which are readily
available where required.
(iv)Fair values of financial assets and financial liabilities
The carrying amounts of financial assets and financial liabilities as reported in the financial statements
approximate their respective fair values due to the relatively short-term maturity of these financial
instruments.
Financial Statements
Notes to Financial Statements
31 March 2014
4 FINANCIAL INSTRUMENTS, FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (cont’d)
(b) Financial risk management policies and objectives
The Commission is exposed to financial risk arising from its operations which include interest rate risk,
credit risk and liquidity risk. The Commission has policies and guidelines, which set out its general risk
management framework as discussed below.
There has been no change to the Commission’s exposure to these financial risks or the manner in which
it manages and measures the risk.
(i)Interest rate risk management
Surplus funds in the Commission are placed with Accountant-General’s Department as disclosed
in Note 6. Interest rate sensitivity analysis has not been presented as management do not expect
any reasonable possible changes in interest rates to have a significant impact on the Commission’s
operations and cash flows.
(ii)Credit risk management
Credit risk, or the risk of counterparties defaulting are controlled by the application of regular monitoring
procedures. The extent of the Commission’s credit exposure is represented by the aggregate balance
of cash and bank balances and receivables.
(iii)Liquidity risk management
Liquidity risk arises in the general funding of the Commission’s operating activities. It includes the
risks of not being able to fund operating activities in a timely manner. To manage liquidity risk, the
Commission places surplus funds with the Accountant-General’s Department which are readily
available where required.
(iv)Fair values of financial assets and financial liabilities
The carrying amounts of financial assets and financial liabilities as reported in the financial statements
approximate their respective fair values due to the relatively short-term maturity of these financial
instruments.
