Gillette_India_Limited_AR_20

Annual Report 2019-20 119 Notes to Financial Statements for the year ended June 30, 2020 Company Overview Board's Report MD&A Corporate Governance Financial Statements Gillette India Limited 30.4.1 Foreign currency sensitivity analysis The Company is mainly exposed to the currencies stated above. The following table details impact to profit or loss of the Company by sensitivity analysis of a 10% increase and decrease in the respective currencies against the functional currency of the Company. 10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management's assessment of the reasonably possible changes in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 10% change on foreign currency rates. If the relevant foreign currency strengthens/weakens by 10% against the functional currency of the Company, profit or loss will increase (decrease) by: Increase / (decrease) at + 10% Increase / (decrease) at - 10% Year ended June 30, 2020 ` in lakhs Year ended June 30, 2019 ` in lakhs Year ended June 30, 2020 ` in lakhs Year ended June 30, 2019 ` in lakhs USD (555) —* 555 —* EUR (145) (69) 145 69 JPY (15) (7) 15 7 GBP (46) (9) 46 9 BDT 15 (46) (15) 46 AUD (4) (16) 4 16 TRY — — — — CNY — 1 — (1) SEK — (1) — — PLN —* — —* — SGD (3) (2) 3 2 * denotes amount less than ` 50 000 30.5 Credit risk management Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company performs ongoing credit evaluation of the counterparty’s financial position as a means of mitigating the risk of financial loss arising from defaults. The Company only grants credit to creditworthy counterparties. The Company does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics as disclosed in Note 9 to the financial statements. 30.6 Interest rate risk management Interest 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. Since the Company does not have interest bearing borrowings, it is not exposed to risk of changes in market interest rates. The Company has not used any interest rate derivatives. 30.7 Other price risk management Other price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded price. The Company is not exposed to pricing risk as the Company does not have any investments in equity instruments and bonds. 30.8 Liquidity risk management Liquidity risk is the risk that the Company will encounter difficulty in raising funds to meet commitments associated with financial instruments that are settled by delivering cash or another financial asset. Liquidity risk may result from an inability to sell a financial asset quickly at close to its fair value. The Company maintains adequate highly liquid assets in the form of cash to ensure necessary liquidity.