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## 1.6.1  Credit risk 

Exposures on trade receivables  are man- aged locally in the operating entities and credit limits set as deemed appropriate for the customer taking into account the current local market conditions. 

The Group does not generally renegotiate the terms of trade receivables with the indi- vidual customer and trade receivables are not changed to on-trade loans. However, if a negotiation takes place, the outstanding balance is included in the sensitivity analysis based on the original payment terms. No significant trade receivables or on-trade loans were renegotiated during 2012 and 2013. 

It is Group policy to reduce the credit risk through prepayments or cash payments on delivery, especially for certain categories of customers in each country. The local entities assess the credit risk and whether it is appro- priate and cost-effective to hedge the credit risk by way of credit or bank guarantees, credit insurance, conditional sale etc. Such security is taken into account when assess- ing impairment losses. Security is primarily received from on-trade customers. 

On-trade loans  are usually repaid through discounts during the continuing sales rela- tionship with the individual customer, which 

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is reflected in the repayment scheme and the discounting of the loans. Consequently, there are no significant overdue on-trade loans. 

Management also assesses whether de- velopments of importance to the on-trade could indicate impairment of on-trade loans in a market in general. Such developments also include changes in local legislation, which may have an adverse effect on the earnings in the industry as a whole and where the effect cannot be allocated to individual loans. 

The credit risk on on-trade loans is usually reduced through collateral and pledges of on-trade movables (equipment in bars, cafés etc.). The fair value of the pledged on-trade movables cannot be estimated reliably but is assessed to be insignificant as the movables 

are used. Movables received through pledges usually need major repair before they can be used again. 

The credit risk on loans to partners is re- duced through pledge of shares in one of the Group’s subsidiaries that are held by the borrower. 

## EXPOSURE TO CREDIT RISK 

The carrying amount of financial assets represents the maximum credit exposure. The carrying amount of financial assets, excluding cash and cash equivalents, of DKK 11,982m (2012: DKK 12,129m) is summarised above. 

The Group’s receivables from the sale of goods and services and on-trade loans are allocated to the countries shown to the right. 

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