167 Annual Report 2024 29 FINANCIAL RISK MANAGEMENT (continued) Overview of risk management Risk management is integral to the whole business of the Group. The Group has a system of controls in place to create an acceptable balance between the cost of risks occurring and the cost of managing the risks. The Manager continually monitors the Group’s risk management process to ensure that an appropriate balance between risk and control is achieved. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s activities. The Audit and Risk Committee of the Manager (the “Audit and Risk Committee”) oversees how the Manager monitors compliance with the Group’s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the Group. The Audit and Risk Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the Audit and Risk Committee. Credit risk Credit risk is the potential financial loss resulting from the failure of a tenant or a counterparty to settle its financial and contractual obligations to the Group, as and when they fall due. Exposure to credit risk Trade receivables The Manager has established credit limits for customers and monitors their balances on an ongoing basis. Credit evaluations are performed by the Manager before lease agreements are entered into with tenants. At 31 December 2024 and 31 December 2023, there was no significant concentration of credit risk. The maximum exposure to credit risk is represented by the carrying value of each financial asset on the Statement of Financial Position. Concentration of credit risk relating to trade receivables is limited due to the Group’s many varied tenants. These tenants are engaged in a wide variety of consumer trades or are in diversified business who are of good quality and strong credit standing. The Group’s historical experience in the collection of accounts receivable falls within the recorded allowances. Due to these factors, the Manager believes that no additional credit risk beyond amounts provided for collection losses is inherent in the Group’s trade receivables. The movement in the allowance for impairment in respect of trade receivables during the year was as follows: Group Trust 2024 2023 2024 2023 $’000 $’000 $’000 $’000 At 1 January 282 525 18 43 Impairment loss recognised 484 42 94 33 Amount written off – (185) – (2) Reversal of impairment loss (232) (104) (18) (56) Translation difference (14) 4 – – At 31 December 520 282 94 18 The Manager believes that, apart from the above, no impairment allowance is necessary in respect of the remaining trade receivables as these receivables arose mainly from tenants that have a good record with the Group and have sufficient security deposits as collateral.
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