Siren Gold Limited Annual Report 2021

15 Financial Risk Management i. Financial Risk Management Policies This note presents information about the Group’s exposure to each of the above risks, its objectives, policies and procedures for measuring and managing risk, and the management of capital. The Group’s financial instruments consist mainly of deposits with banks, short-term investments, and accounts payable and receivable. The Group does not speculate in the trading of derivative instruments. A summary of the Group’s Financial Assets and Liabilities is shown below: Floating Interest Rate $ Fixed Interest Rate $ Non- interest Bearing $ 2021 Total $ Floating Interest Rate $ Fixed Interest Rate $ Non- interest Bearing $ 2020 Total $ Financial Assets -  Cash and cash equivalents 5,729,496 – – 5,729,496 8,801,581 – – 8,801,581 -  Trade and other receivables – – 220,704 220,704 – – 143,920 143,920 -  Other assets 125,044 – – 125,044 113,646 – – 113,646 Total Financial Assets 5,854,540 – 220,704 6,075,244 8,915,227 – 143,920 9,059,147 Financial Liabilities -  Trade and other payables – – 578,077 578,077 – – 580,388 580,388 -  Borrowings – 17,227 – 17,227 – 15,913 – 15,913 Total Financial Liabilities – 17,227 578,077 595,304 – 15,913 580,388 596,301 Net Financial Assets/ (Liabilities) 5,854,540 (17,227) (357,373) 5,479,940 8,915,227 (15,913) (436,468) 8,462,846 ii. Specific Financial Risk Exposures and Management The main risks the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk, consisting of interest rate, foreign currency risk and equity price risk. However, the sole material risk at the present stage of the Group is liquidity risk. The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework. The Board adopts practices designed to identify significant areas of business risk and to effectively manage those risks in accordance with the Group’s risk profile. This includes assessing, monitoring and managing risks for the Group and setting appropriate risk limits and controls. The Group is not of a size nor are its affairs of such complexity to justify the establishment of a formal system for risk management and associated controls. Instead, the Board approves all expenditure, is intimately acquainted with all operations and discusses all relevant issues at the Board meetings. The operational and other compliance risk management have also been assessed and found to be operating efficiently and effectively. iii. Credit risk Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract obligations that could lead to a financial loss to the Group. iv. Liquidity risk Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. Ultimate responsibility for liquidity risk management rests with the Board of Directors, who have built an appropriate liquidity risk management framework for the management of the Group’s short, medium and long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. Notes to the Consolidated Financial Statements for the year ended 31 December 2021 Annual Report 2021 47