GSK_Annual_Report_2021

Notes to the Consolidated Financial Statements for the year ended March 31, 2021 (contd.) Annual Report 2020-21 215 Exposure to currency risk The Group’s exposure to foreign currency risk at the end of the reporting period is as follows: ( ` in lakhs) As at March 31, 2021 As at March 31, 2020 GBP USD EUR Others GBP USD EUR Others Current Financial assets 4,45.84 - 4.31 - 27.56 - - - Trade payables (24,01.30) (97,22.69) (6,21.51) (93.11) (13,05.69) (47,19.02) (1,58.27) (81.74) Capital Creditors - (6.03) - - - (1,25.96) (10,07.08) - Net statement of financial position exposure (19,55.46) (97,28.72) (6,17.20) (93.11) (12,78.13) (48,44.98) (11,65.35) (81.74) Sensitivity analysis A reasonably possible strenghtening / weakening of the respective foreign currencies with respect to functional currency of Group would result in increase or decrease in profit or loss and equity as shown in table below. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases. The following analysis has been worked out based on the exposures as of the date of statements of financial position. Effect in ` Lakhs Strengthening / Weakening % Profit or (loss) Equity Strengthening Weakening Strengthening Weakening As at March 31, 2021 GBP 5% (97.77) 97.77 - - USD 5% (4,86.44) 4,86.44 - - EUR 5% (30.86) 30.86 - - Other currencies 5% (4.66) 4.66 - - Effect in ` Lakhs Strengthening / Weakening % Profit or (loss) Equity Strengthening Weakening Strengthening Weakening As at March 31, 2020 GBP 5% (63.91) 63.91 - - USD 5% (2,42.25) 2,42.25 - - EUR 5% (58.27) 58.27 - - Other currencies 5% (4.09) 4.09 - - (Note: The impact is indicated on the profit/loss before tax basis) Note 49 : Capital Management (a) Risk Management The Group’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors the return on capital as well as the level of dividends to ordinary shareholders. The Group has adequate cash and bank balances and no interest bearing liabilities. The Group has interest free deferred sales tax incentive availed under the 1993 Sales Tax Deferment Schemes. The Group monitors its capital by a careful scrutiny of the cash and bank balances, and a regular assessment of any debt requirements. In the absence of any interest bearing debt, the maintenance of debt equity ratio etc. may not be of any relevance to the Group. No changes were made in the objectives, policies or processes for managing capital during the years ended March 31, 2021 and March 31, 2020.