Freight Transport Limited

Risks and uncertainties The company uses financial instruments, other than derivatives, comprising borrowings, cash and other liquid resources and various other items such as trade debtors and creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the company's operations. The main risks arising from the company's financial instruments are interest rate risk, foreign exchange risk and liquidity risk. The director reviews and agrees policies for managing each of these risks and they are summarised below: Interest rate risk The company finances its operations through a mixture of retained profits and asset finance. The company's HP finance is structured with fixed monthly payments preventing any fluctuation from varying interest rates. Foreign exchange risk The company is able to absorb any foreign exchange losses arising from fluctuations in exchange rates and therefore does not require any hedging instruments. Liquidity risk The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest any cash assets safely and profitably. Overall the director is of the opinion that the risks that are applicable to the business are managed in such a way that they do not have a significant impact on the business. Global activities The directors have considered the impact of the events happening on global scale with particular reference to how this may disrupt their business model, strategy and operations. The directors have liaised with suppliers and customers, and similarly they have no dealings that will impact the company's supply chain, recoverability of debt and credit. There has been a worldwide impact on the cost of particular goods, including fuel, which in turn has increased the costs of the business. The directors have calculated the effect and believe that this will not significantly impact it's ability to trade or going concern.