- Part 4: For the preceding part double click ID:nRST3729Gc
(including
currency
risk, price
risk and
interest
rate risk),
credit risk
and
liquidity
risk. The
Company's
overall risk
management
programme
focuses on
the
unpredictabi
lity of
financial
markets and
seeks to
minimise
potential
adverse
effects on
the
Company's
financial
performance.
a) Market
Risk
i) Foreign
exchange
risk
The Company
is not
exposed to
significant
currency
risk as it
invests in
companies
listed on
the London
Stock
Exchange,
predominatel
y
denominated
in Sterling
and has cash
balances
denominated
in Sterling.
ii) Price
Risk
Price risk
is the risk
that the
fair value
of the
future cash
flows of a
financial
instrument
will
fluctuate
due to
changes in
market
prices. The
Company is
exposed to
price risk
on the
investments
held by the
Company and
classified
by the
Company on
the
Statement of
Financial
Position as
fair value
through
profit or
loss. To
manage its
price risk
management
closely
monitor the
activities
of the
underlying
investments.
The
Company's
exposure to
price risk
is as
follows:
Fair Value
Fair Value 536,821
Through
Profit or
Loss, as at
30 June 2015
Fair Value 682,888
Through
Profit or
Loss, as at
30 June 2014
The
Company's
investments
are all
publicly
traded and
listed on
either the
Alternative
Investment
Market
("AIM") or
on the
Australian
Stock
Exchange.
The
Company's
sensitivity
to a 15%
increase/(de
crease) in
market price
would be
£80,523/(£80
,523) (2014:
£102,433/(£1
02,433)). A
positive
number
indicates an
increase in
the net
assets
attributable
to ordinary
shareholders
and a
negative
number
indicates a
decrease.
The 15%
increase/(de
crease) on
the net
assets
attributable
to ordinary
shareholders
would have
the same
impact on
the post-tax
profit for
the year.
15%
represents
management's
assessment
of a
reasonably
possible
change in
the market
prices.
iii)
Interest
rate
riskInterest
rate risk is
the risk
that the
fair value
or future
cash flows
of a
financial
instrument
will
fluctuate
because of
changes in
market
interest
rates. The
Company is
not
significantl
y exposed to
interest
rate risk as
it does not
have any
borrowings,
however, the
Company does
- More to follow, for following part double click ID:nRST3729Ge