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Atul Ltd | Annual Report 2017-18
Particulars
As at March 31, 2017
US$ mn
` cr
€ mn
` cr
£mn
` cr
Financial assets
Trade receivables
37.67
244.26
2.43
16.80
0.10
0.77
Dividends receivable
–
–
–
–
0.65
5.25
Less:
Hedged through derivatives
1
Currency range options
7.65
49.60
–
–
–
–
Net exposure to foreign currency risk (assets)
30.02 194.66
2.43
16.80
0.75
6.02
Financial liabilities
Borrowings
10.67
69.15
–
–
–
–
Trade payables
8.07
52.33
0.22
1.52
0.01
0.04
Less:
Hedged through derivatives
1
Foreign exchange forward contracts
9.00
58.35
–
–
–
–
Currency swaps
1.67
10.80
–
–
–
–
Net exposure to foreign currency risk (liabilities)
8.07
52.33
0.22
1.52
0.01
0.04
1
Includes hedges for highly probable transactions up to next 12 months
c)
Management of credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty fails to meet its contractual
obligations.
Trade receivables
Concentrations of credit risk with respect to trade receivables are limited, due to the customer base being
large, diverse and across sectors and countries. All trade receivables are reviewed and assessed for default on a
quarterly basis.
Historical experience of collecting receivables of the Company is supported by low level of past default and hence
the credit risk is perceived to be low.
Reconciliation of loss allowance provision – Trade receivables
(
`
cr)
Particulars
Loss allowance on
Trade receivables
Loss allowance as on March 31, 2016
3.80
Changes in loss allowance
(0.64)
Loss allowance as on March 31, 2017
3.16
Changes in loss allowance
(0.56)
Loss allowance as on March 31, 2018
2.60
Other financial assets
The Company maintains exposure in cash and cash equivalents, term deposits with banks, investments in Government
securities, preference shares and loans to subsidiary companies. The Company has diversified portfolio of investment with
various number of counterparties which have secure credit ratings, hence the risk is reduced. Individual risk limits are set for
each counterparty based on financial position, credit rating and past experience. Credit limits and concentration of exposures
are actively monitored by the treasury department of the Company.
Notes
to the Financial Statements
Note 27.8 Financial Risk Management
(continued)