Annual Report 2019

227 Transport International Holdings Limited 2019 Annual Report Notes to the Financial Statements 31 Financial risk management and fair values of financial instruments (continued) (d) Currency risk (continued) (ii) Sensitivity analysis The table below indicates the instantaneous change in the Group’s profit after tax (and retained profits) and other components of consolidated equity that would arise if foreign exchange rates to which the Group has significant exposure at the end of the reporting period had changed at that date, assuming all other risk variables remained constant. In this respect, it is assumed that the pegged rate between Hong Kong dollars and United States dollars would be materially unaffected by any changes in movement in value of United States dollars against other currencies. 2019 2018 Increase/ (decrease) in foreign exchange rates Increase/ (decrease) in profit after tax and retained profits Increase/ (decrease) in other components of equity Increase/ (decrease) in foreign exchange rates Increase/ (decrease) in profit after tax and retained profits Increase/ (decrease) in other components of equity $’000 $’000 $’000 $’000 Renminbi 3% 88 – 3% 61 – (3)% (88) – (3)% (61) – British Pounds Sterling 6% 1,497 – 6% 2,522 – (6)% (1,497) – (6)% (2,522) – United States dollars 1% 2,050 14,500 1% 1,960 14,281 (1)% (2,050) (14,500) (1)% (1,960) (14,281) Results of the analysis as presented in the above table represent an aggregation of the instantaneous effects on each of the Group entities’ profit after tax and equity measured in the respective functional currencies, translated into Hong Kong dollars at the exchange rate ruling at the end of the reporting period for presentation purposes. The sensitivity analysis assumes that the change in foreign exchange rates had been applied to re-measure those financial instruments held by the Group which expose the Group to foreign currency risk at the end of the reporting period, including inter-company payables and receivables within the Group which are denominated in a currency other than the functional currencies of the lender or the borrower. The analysis excludes differences that would result from the translation of the financial statements of operations outside Hong Kong into the Group’s presentation currency. The analysis is performed on the same basis for 2018. Renminbi is not a fully convertible currency. All foreign exchange transactions involving Renminbi must take place either through the People’s Bank of China or other institutions authorised to buy and sell foreign exchange.