01 02 03 Financial Statements 04 39. Risk management continued Credit risk Credit risk is the risk that the Group will incur a loss because its customers, clients or counterparties fail to discharge their contractual obligations. The Group manages and controls credit risk by setting limits on the amount of risk it is willing to accept for individual counterparties and for product and currency concentrations, and by monitoring exposures in relation to such limits. Also, the Group establishes and regularly monitors credit terms by types of debtors, which is a proactive tool for managing the credit risk. The Group has established a credit quality review process to provide early identification of possible changes in the creditworthiness of counterparties, including regular analysis of debt service and ageing of receivables. Counterparty limits are established in combination with credit terms. The credit quality review process allows the Group to assess the potential loss as a result of the risks to which it is exposed and take corrective action. The credit quality of financial assets is managed by the Group based on number of overdue days. The table below shows maximum exposure to credit risk and credit quality by class of asset in the statement of financial position. Credit quality per class of financial assets Neither past due nor Past-due but impaired not impaired Impaired Total 31 December 31 December 31 December 31 December Notes 2018 2018 2018 2018 Amounts due from credit institutions 8 11,807 – – 11,807 Insurance premiums receivable 9 23,643 – 2,391 26,034 Receivables from sales of pharmaceuticals 20,440 – 584 21,024 Receivables from healthcare services 10 65,799 41,042 19,189 126,030 Other assets: loans issued and lease deposit 16 3,284 – – 3,284 Other assets: other receivables 7,497 177 2,428 10,102 132,470 41,219 24,592 198,281 Neither past due nor Past-due but impaired not impaired Impaired Total 31 December 31 December 31 December 31 December Notes 2017 2017 2017 2017 Amounts due from credit institutions 8 14,768 – – 14,768 Insurance premiums receivable 9 20,233 – 2,329 22,562 Receivables from sales of pharmaceuticals 19,798 – – 19,798 Receivables from healthcare services 10 75,424 25,520 17,337 118,281 Other assets: loans issued and lease deposit 16 3,199 – – 3,199 Other assets: other receivables 16 3,115 – 2,473 5,588 Total 136,537 25,520 22,139 184,196 Financial assets that are in overdue for less than 30 days are considered to have relatively low credit risk unless there is some forward-looking evidence to the contrary. Such assets are classified in grades “AA” (table 1 in Note 3) and “A” (table 2 in Note 3) in accordance with the Group’s accounting policy and are included in “neither past due not impaired” category. The forward-looking evidence can be from the third-party sources including mass media, credit rating changes by rating provider agencies and events that have not yet affected but are expected to have impact on the creditworthiness of the third parties. Below is the summary of grades as included in the categories presented in the table above: • Neither past due nor impaired category includes grades “AA” (table 1 in Note 3) and “A” (table 2 in Note 3). • Past-due but not impairment category includes receivables from grades “A”, “B” and “C” (table 1 in Note 3) and “B” and “C” (table 2 in Note 3). • Impaired category includes receivables from grade “D” (both table 1 and table 2 in Note 3). 167