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FINANCIALS
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Exposure to credit risk
The carrying amount of financial assets represents the Group’s and the Trust’s respective maximum exposure to credit
risk, before taking into account any collateral held. The maximum exposure to credit risk by type of financial assets at the
reporting date was:
Group
Trust
Note
2017
$’000
2016
$’000
2017
$’000
2016
$’000
Derivative financial instruments
7
126
472
104
470
Trade and other receivables
8
5,629
3,488
1,794
3,826
Cash and cash equivalents
9
76,603
76,953
30,493
11,740
82,358
80,913
32,391
16,036
The Group has established credit procedures for its tenants, obtains security deposits and/or bank guarantees (where
applicable), and monitors their balances on an ongoing basis. Credit evaluations are performed by the Group before
lease agreements are entered into with tenants.
The tenant profile of the Group is generally well-diversified, except for four (2016: four) largest tenants (Note 23), which
accounted for approximately 46.1% (2016: 45.8%) of the Group’s gross rent as at 30 June 2017.
Cash and fixed deposits are placed with financial institutions which are regulated and have sound credit ratings. Given
these sound credit ratings, the Group does not expect any counterparty to fail to meet its obligations.
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another financial asset.
The Group monitors its liquidity risk and maintains a level of cash and cash equivalents deemed adequate to finance
its operations and to mitigate the effects of fluctuations in cash flows. The Group ensures that it has sufficient cash on
demand to meet expected operational expenses for a reasonable period, including the servicing of financial obligations.
As at 30 June 2017, the Group has undrawn and committed long-term revolving credit facilities of up to $200 million (2016:
$200 million) and cash and cash equivalents of approximately $76.6 million (2016: $77.0 million).
In addition, the Group also monitors and observes the Property Fund Appendix issued by MAS concerning limits on total
borrowings.
Foreign currency risk
The Group is exposed to foreign currency risk arising from its investments in Australia, Malaysia, China and Japan. The
income generated from these investments and net assets are denominated in foreign currencies, mainly Australian Dollar
(“A$”), Ringgit Malaysia (“RM”), Chinese Renminbi (“RMB”) and Japanese Yen (“JPY”).
The Group’s exposures to various foreign currencies (expressed in Singapore dollar equivalent), which relate primarily to its
net foreign currency investments as at balance sheet date are as follows:
A$
$’000
RM
$’000
RMB
$’000
JPY
$’000
Total
$’000
Group
2017
Net balance sheet exposure
343,724
258,787
30,006
8,702
641,219
2016
Net balance sheet exposure
317,815
272,029
40,679
6,437
636,960