| CIM FINANCE. INTEGRATED REPORT 2022 142 EXPLANATORY NOTES 30 SEPTEMBER 2022 4. FINANCIAL RISK MANAGEMENT (CONT’D) 4.2 Capital risk management The primary objective of the Group’s and the Company’s capital management is tomaximise shareholders’ value. The Company aims at distributinganadequatedividendwhilst ensuring that sufficient resources aremaintained to continueas agoing concern and for expansion. TheGroupand theCompanymanage their capital structureandmakeadjustments in the light of changes ineconomic conditions and the requirements of the financial covenants. Tomaintain or adjust the capital structure, the Groupmay adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The ratio of net debt to equity is used to monitor capital and the ratio is kept at a reasonable level. For the purpose of capital management, net debt includes other borrowed funds net of cash and bank balances. Equity consists of stated capital, retained earnings and other reserves. TheGroupmonitors its Capital Adequacy Ratio (CAR) ona regular basis anduses the latter as a keymetric toassess its robustness to sustain economic shocks in the period under review, despite this significant increase in the impairment charges, the Capital Adequacy Ratio remained at a very reasonable level. GROUP COMPANY Sep-22 MUR m Sep-21 MUR m Sep-22 MUR m Sep-21 MUR m Restated* Restated* Debt (note 23 and 27) 11,944.5 10,051.5 12,071.2 10,149.3 Less: Cash and cash equivalents (note 13) (609.1) (317.3) (588.0) (311.9) 11,335.4 9,734.2 11,483.2 9,837.4 Equity - restated 4,969.2 4,580.9 5,138.5 4,747.4 Net debt/equity ratio 2.3 2.1 2.2 2.1 The net debt to equity ratio changed from 2.1 times in 2021 to 2.3 times in 2022 for the Group and from 2.1 times in 2021 to 2.2 times in 2022 for the Company. *Refer to Note 39 Restatement and reclassifications.
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