Page 128 - Annual Report 2016 EN

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Currency risk
Currency risk is the risk that the fair value or future cash flows of
a financial instrument will fluctuate due to changes in foreign
exchange rates. The QFC Regulatory Authority’s principal business
is conducted in United States Dollars and Qatari Riyals. As the Qatari
Riyal is pegged to the United States Dollar, there is considered to
be minimal currency risk.

Equity price risk
Equity price risk is the risk that the fair values of equities decrease
as a result of changes in the levels of equity indices and the value
of individual stocks. The QFC Regulatory Authority is not exposed
to equity price risk since it does not hold any investment in equity
instruments.

Credit risk
Credit risk is the risk that one party to a financial instrument will
cause a financial loss for the other party by failing to discharge its
obligation. The QFC Regulatory Authority exposure to credit risk is
indicated by the carrying values of its assets which consist princi-
pally of bank balances, fees and other receivables.
The carrying amount of financial assets represents the maximum
credit exposure. The maximum exposure to credit risk at the report-
ing date was:

2016 2015
USD ‘000 USD ‘000
Interest receivables 122 156
Other receivables 73 61

Amount due from related parties 1,160 32
Bank balances 25,097 26,144

26,452 26,393

Credit risk in respect of bank balances is limited as the QFC Reg-
ulatory Authority only deals with highly reputable banks in Qatar
and abroad.