CONTENTS FINANCIAL STATEMENTS YEAR IN REVIEW DIRECTORS’ REPORT CORPORATE DIRECTORY SHAREHOLDER INFORMATION 6. Financial risk management (continued) Interest rate risk management The Group is exposed to interest rate risk as the Group holds cash at both fixed and floating interest rates. The Group’s exposure to interest rate risk is limited to the amount of interest income it can potentially earn on surplus cash deposits. Credit risk management Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group’s exposure and the credit ratings of its counterparties are continuously monitored, and the aggregate value of transactions concluded is spread amongst approved counterparties. The carrying amount of financial assets recorded in the financial statements, net of any allowance for losses, represents the Group’s maximum exposure to credit risk without taking account of the value of any collateral obtained. Liquidity risk management Ultimate responsibility for liquidity risk management rests with the Directors, who have built an appropriate liquidity risk management framework for the management of the Group’s funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves and banking facilities by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. The Group’s financial instruments are as follows: Weighted average interest rate 2024 Floating interest rate $’000 < 1 year $’000 1 to 5 years $’000 > 5 years $’000 Noninterest bearing $’000 Total $’000 Fixed Floating Financial assets Cash and cash equivalents 9,604 – – – 274 9,878 5.03% 4.50% Trade and other receivables – 30 – – 23 53 4.94% – Financial assets at fair value through profit or loss – – – – 1,072 1,072 9,604 30 – – 1,369 11,003 Financial liabilities Trade and other payables – – – – 305 305 – – – – – – 305 305 Weighted average interest rate 2023 Floating interest rate $’000 < 1 year $’000 1 to 5 years $’000 > 5 years $’000 Noninterest bearing $’000 Total $’000 Fixed Floating Financial assets Cash and cash equivalents 24,057 – – – 349 24,406 5.01% 4.25% Trade and other receivables – 30 – – 34 64 5.20% – 24,057 30 – – 383 24,470 Financial liabilities Trade and other payables – – – – 184 184 – – – – – – 184 184 47 Sheffield Resources Limited Annual Report 2024
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