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Risk management
Credit risk
Credit risk is the potential fnancial loss resulting from the failure of a customer or counterparty to settle its fnancial and contractual
obligations to the Group, as and when they fall due.
The property manager conducts fnancial assessments on tenants before entering into lease agreements. Tenants are required to
place signifcant amount of security deposits for lease and ft-out rentals. The property manger monitors their account receivable
balances on an ongoing basis to minimise the impact of a defaulting customer on the performance of the property.
Liquidity risk
The Group maintains suffcient cash and cash equivalents to meet the normal operating cash requirement. The Group regularly
monitors and observes bank covenant for borrowings.
A-ITRUST ANNUAL REPORT 2011/2012 47