Creative 2014 Annual Report Download - page 55

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55
CREATIVE TECHNOLOGY LTD AND ITS SUBSIDIARIES
Group
2013
Financial assets
Cash and cash equivalents 58,259 82,586 12,344 4,747 5,638 163,574
Financial assets, available-for-sale 13,462 9,192 – – – 22,654
Trade receivables 8,761 1,076 2,912 988 991 14,728
Other receivables 274 187 – – 95 556
Other nancial assets-deposits 62 320 28 25 81 516
80,818 93,361 15,284 5,760 6,805 202,028
Financial liabilies
Financial liabilies (37,905) (12,461) (7,075) (289) (519) (58,249)
Net nancial assets 42,913 80,900 8,209 5,471 6,286 143,779
A change of 10% in foreign currency exchange rates relative to US$ at the reporting date would increase/decrease prot
(loss) by the amounts shown below. This analysis assumes that all other variables remain constant.
 
10% 10%
 
US$’000 US$’000
Group
2014
SGD against USD 6,549 (6,549)
EUR against USD 1,662 (1,662)
GBP against USD 460 (460)
Others against USD 677 (677)
2013
SGD against USD 8,090 (8,090)
EUR against USD 821 (821)
GBP against USD 547 (547)
Others against USD 629 (629)
USD SGD EUR GBP Others Total
US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
(b) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in nancial loss to the
Group. Financial instruments that potentially subject the Group to signicant concentrations of credit risk consist principally
of cash and cash equivalents and trade receivables. The Group deals only with nancial institutions with high credit
ratings and limits the amount of credit exposure to any one nancial institution. The Group sells its products to original
equipment manufacturers, distributors and key retailers. The Group believes that the concentration of credit risk in its trade
receivables is substantially mitigated due to performance of ongoing credit evaluations of its customers’ nancial condition,
use of short collection terms, use of letters of credit in certain circumstances, procurement of credit insurance coverage and
the geographical dispersion of sales. The Group establishes allowances for doubtful accounts, returns and discounts for
specically identied doubtful accounts, returns and discounts based on credit proles of its customers, current economic
trends, contractual terms and conditions and historical payment, returns and discount experience.
The maximum exposure to credit risk for each class of nancial instruments is the carrying amount of that class of nancial
instruments presented on the balance sheet.