Page 198 - Arvind 2024

Notes to Standalone Financial Statements for the year ended 31st March, 2024 (Amount in Rs. Lac, unless stated otherwise)
Particulars
Changes in interest rate
Effect of profit before tax
March 31, 2024 March 31, 2023
2. Credit Risk
+1% (61.91)
-1% 61.91
+1% (51.93)
-1% 51.93
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The carrying amount of following financial assets represents the maximum credit exposure.
Trade receivables
Receivables resulting from sale of properties: Customer credit risk is managed by requiring customers to pay advances before transfer of ownership, therefore substantially eliminating the company’s credit risk in this respect.
The ageing of trade receivables (net) is as follows:
More than 6 months Others
Total receivables
Financial Instrument and cash deposits
13.87 164.44 178.31
Particulars
March 31, 2024
13.87
March 31, 2023
173.13
187.00
Credit risk from balances with banks and financial institutions is managed by the company’s treasury department in accordance with the company’s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the company’s Board of Directors on an annual basis. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through a counterparty’s potential failure to make payments. The company’s maximum exposure to credit risk for the components of the statement of financial position at March 31, 2024 and March 31, 2023 is the carrying amounts.
3. Liquidity Risk
Liquidity risk is the risk that the company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company‘s reputation.
The table below summarises the remaining contractual maturities of the company’s financial liabilities at the reporting date.
Year ended March 31, 2024
Borrowings*
Trade payables
Other financial liabilities Lease Liabilities
Particulars
On demand
Less than 3 months
3 months to 1 year
1 year to 5 years
More than 5 Years
Total
-
465.64
1,210.92
4,660.85
-
6,337.41
-
3,079.90
-
-
-
3,079.90
4062.03
597.23
-
-
-
4659.26
4062.03
-
7.62
22.86
1,233.78
251.34
4,912.19
88.59
88.59
370.41
4150.39
14446.98
196 | Arvind SmartSpaces Limited