Page 275 - InterloopAnnualReport2020

NOTES TO THE CONSOLIDATED

FINANCIAL STATEMENTS

For the year ended June 30, 2020

The following significant exchange rates were applied during the year :

2020 2019
Foreign Currency Selling Buying Selling Buying
Rupees
US $ 168.75 168.25 142.70 164.00
EUR € 189.73 189.11 163.85 186.37
GBP £ 207.68 207.05 183.80 208.45
CHF 177.43 176.83 145.07 168.03
CNY 24.00 23.92 21.29 23.85
JPY ¥ 1.57 1.56 1.31 1.53

Currency rate sensitivity analysis
If the functional currency, at reporting date, had weakened by 10% against the foreign currencies with all
other variables held constant, the profit before taxation would have increased for the year 2020 and 2019 by
the following amounts:

2020 2019
Foreign Currency (Rupees ‘000) (Rupees ‘000)
US $ 577,223 746,684
EUR € (1,629) (2,019)
GBP £ (316) –
CNY – (2)
CHF – (7)
JPY ¥ (3) –
575,275 744,655

A 10% strengthening of the functional currency against foreign currencies at June 30 would have had the
equal but opposite effect of these amounts.

Currency risk sensitivity to foreign exchange movements has been calculated on a symmetric basis. The
analysis assumes that all other variables remained constant.

53.1.3 Other price risk
Price risk represents the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market prices (other than those arising from interest rate risk or currency risk), whether
those changes are caused by factors specific to the individual financial instrument or its issuer, or factors
affecting all similar financial instruments traded in the market. The group is not exposed to any significant
other price risk.

53.2 Credit risk
Credit risk is the risk representing accounting loss that would be recognized at the reporting date if one
party to a financial instrument will fail to discharge an obligation or its failure to perform duties under the
contract as contracted. Concentration of credit risk arises when a number of counterparties are engaged in
similar business activities or have similar economic features that would cause their ability to meet contractual
obligations that is susceptible to changes in economic, political or other conditions. Concentration of credit
risk indicates the relative sensitivity of the Company’s performance to developments affecting a particular
industry. The maximum exposure to credit risk at the reporting date is as follows:

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