Page 127 - Annual Report 2016 EN

127 |

Related party transactions
The significant related party transactions are as follows:

2016 2015
USD ‘000 USD ‘000
Appropriations from Government 34,217 37,023
Services from QFCA 1,948 1,863

Services and expenses paid on behalf of related parties 465 208

Compensation of key management personnel
Key management personnel include the Board of Directors, Chief
Executive Officer, Managing Directors, Chief Operating Officer,
Chief Financial Officer and Chief Administrative Officer. Key man-
agement personnel remuneration includes the following expenses:

2016 2015
USD ‘000 USD ‘000
Short-term benefits 4,383 5,053

[13] FINANCIAL RISK MANAGEMENT

The QFC Regulatory Authority’s financial liabilities comprise trade Market risk
payables and accrued expenses. The main purpose of these finan- Market risk is the risk that changes in market prices, such as inter-
cial liabilities is to finance the QFC Regulatory Authority’s operations est rates and foreign currency exchange rates, will affect the
and to provide guarantees to support its operations. The QFC Branch’s profit or the value of its holdings of financial instruments.
Regulatory Authority’s financial assets include interest receivables, The objective of market risk management is to manage and con-
other receivables, amount due from related parties, bank balances trol the market risk exposure within acceptable parameters, while
and cash that derive directly from its operations. optimizing return.
The QFC Regulatory Authority is exposed to market risk, credit risk Interest rate risk
and liquidity risk. The management has overall responsibility for the Interest rate risk is the risk that the fair value or future cash flows of
establishment and oversight of the QFC Regulatory Authority’s risk a financial instrument will fluctuate due to changes in market inter-
management framework. The QFC Regulatory Authority’s risk man- est rates. The QFC Regulatory Authority is not exposed to interest
agement policies are established to identify and analyse the risks rate risk on its interest bearing assets (bank deposits) as the interest
faced by the QFC Regulatory Authority, to set appropriate risk rate on bank deposits is fixed. The statement of comprehensive
limits and controls, and to monitor risks and adherence to limits. income and equity is not sensitive to the effect of reasonable pos-
Risk management policies and systems are reviewed regularly to sible changes in interest rates, with all other variables held constant,
reflect changes in market conditions and the QFC Regulatory as the QFC Regulatory Authority does not hold any floating rate
Authority’s activities. financial assets or financial liabilities at the reporting date.
This note presents information about the QFC Regulatory Authority’s
exposure to each of the above risks. Further quantitative disclosures
are included throughout these financial statements.