KIM HENG OFFSHORE & MARINE HOLDINGS LIMITED
76
Notes to the financial statements
8 Trade and other receivables (Cont’d)
Amounts due from subsidiaries
Outstanding balances with subsidiaries are unsecured, interest-free and are repayable on demand. There is no
allowance for doubtful debts arising from these outstanding balances.
Credit and market risks, and impairment losses
The Group’s exposure to credit and currency risks, and impairment losses related to trade and other receivables
is disclosed in note 15.
Allowance for doubtful receivables
The Group maintains an allowance for doubtful accounts on the estimated losses resulting from the subsequent
inability of the Group’s customers to make the required payments, at a level considered adequate to provide for
potential uncollectible receivables. The level of this allowance is evaluated by the Group on the basis of factors
that affect the collectability of the individual accounts. Management specifically analysed accounts receivables
and analysed historical bad debts, customer creditworthiness, current economic trends, changes in customer
payment terms, customer defaults on payment terms, legal proceedings and other available information when
evaluating the adequacy of allowance for doubtful debts. The amount and timing of recorded expenses for any
period would differ if the Group made different judgement or utilised different estimates. An increase in the
Group’s allowance for doubtful accounts would increase the Group’s recorded other expenses and decrease
current assets.
9 Cash and cash equivalents
Group
Company
2015
2014
2015
2014
$’000
$’000
$’000
$’000
Cash at bank and in hand
9,860
23,701
3,234
6,937
Fixed deposits
22,944
26,193
22,245
25,231
Cash and cash equivalents
32,804
49,894
25,479
32,168
Deposits pledged
(698)
(963)
–
–
Cash and cash equivalents in the statement of cash
flows
32,106
48,931
25,479
32,168
The fixed deposit for the one of the entities within the Group amounting to $404,000 is pledged as security
deposit for its operating lease of office premises and warehouse (2014: $404,000). The remaining fixed deposits
amounting to $294,000 are pledged to secure term loans and finance lease liabilities (2014: $559,000) (see note
12).
The Group’s exposure to interest rate and currency risks is disclosed in note 15.
