Amal Ltd 2016-17

Notes to the Financial Statements Amal Ltd | Annual Report 2016-17 (A) Credit risk The Company is exposed to credit risk, which is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. Credit risk arises from cash and cash equivalents, investments carried at amortised cost or fair value through profit & loss and deposits with banks and financial institutions, as well as credit exposures to trade/non-trade customers including outstanding receivables. (i) Credit risk management Credit risk is managed at corporate level depending on the policy surrounding credit risk management. (ii) Provision for expected credit losses Trade receivables Trade receivables consist of major amount receivable from Atul Ltd, the Holding company, for which no credit risk is involved. (B) Liquidity risk Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Management monitors rolling forecasts of the Company’s liquidity position and cash and cash equivalents on the basis of expected cash flows. This is generally carried out at corporate level in accordance with practice and limits set by the management. These limits vary by taking into account the liquidity of the market in which the entity operates. In addition, the Company’s liquidity management policy involves projecting cash flows and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory | operating requirements.” (i) Maturities of financial liabilities The tables below analyse the Company’s financial liabilities into relevant maturities based on their contractual maturities for: The following are contractual maturity of financial liability at the reporting date. The amount are gross and undiscounted, and includes contractual interest payment. Contractual maturities of financial liabilities March 31, 2017 Less than 1 year More than 1 year Total Borrowings 30,000 2,04,347 2,34,347 Trade payables 16,608 16,608 Retention payable 454 454 Employee benefit payable 352 352 Provision for expenses 4,452 4,452 Total financial liabilities 51,866 2,04,347 2,56,213