Cash flows
Financial Performance (PBT)
Financial Position (Equity / Liability)
Softlogic Life employs stress testing on critical risks to assess their potential financial impacts on the current and future financial statements. This process helps management identify which risks should be prioritized and managed, as well as where resources should be allocated. Stress testing is conducted annually, and the results from the current year serve as the foundation for estimating medium-term stress scenarios on the financial statements. Given the rapid changes in our operating environment and the fact that our annual financial planning cycle covers three-year projections, we limit our stress testing to short- and medium-term horizons to ensure more accurate estimations.
We believe that evaluating each risk individually for its financial impact would not provide a comprehensive or accurate picture for users of our annual report. Therefore, we focus on critical risks and, where applicable, provide a combined financial impact analysis to offer a more holistic view of potential outcomes. Below table provides the financial impact of critical risks identified under stress scenarios.
*Due to exess liquidity position we maintain we don’t expect significant financial impact due to liquidity risk