annual report 2014
I
Notes to the Financial Statements
31 December 2014 (Cont’d)
69
4.
SIGNIFICANT ACCOUNTING POLICIES (cont’d)
4.8 Financial instruments (Cont’d)
(a)
Financial assets
(Cont’d)
(iii)
Loans and receivables
Financial assets classified as loans and receivables comprise non-derivative financial assets with
fixed or determinable payments that are not quoted in an active market.
Subsequent to initial recognition, financial assets classified as loans and receivables are measured
at amortised cost using the effective interest method. Gains or losses on financial assets classified
as loans and receivables are recognised in profit or loss when the financial assets are derecognised
or impaired, and through the amortisation process.
(iv)
Available-for-sale financial assets
Financial assets classified as available-for-sale comprise non-derivative financial assets that are
designated as available for sale or are not classified as loans and receivables, held-to-maturity
investments or financial assets at fair value through profit or loss.
Subsequent to initial recognition, financial assets classified as available-for-sale are measured at
fair value. Any gains or losses arising from changes in the fair value of financial assets classified as
available-for-sale are recognised directly in other comprehensive income, except for impairment
losses and foreign exchange gains and losses, until the financial asset is derecognised, at which
time the cumulative gains or losses previously recognised in other comprehensive income are
recognised in profit or loss. However, interest calculated using the effective interest method is
recognised in profit or loss whilst dividend on available-for-sale equity instruments are recognised
in profit or loss when the right of the Group to receive payment is established.
Cash and bank balances include cash and cash equivalents, bank overdrafts, deposits and other short
term, highly liquid investments with original maturities of three (3) months or less, which are readily
convertible to cash and are subject to insignificant risk of changes in value.
A financial asset is derecognised when the contractual right to receive cash flows from the financial asset
has expired. On derecognition of a financial asset in its entirety, the difference between the carrying
amount and the sum of consideration received (including any new asset obtained less any new liability
assumed) and any cumulative gain or loss that had been recognised directly in other comprehensive
income shall be recognised in profit or loss.
A regular way purchase or sale is a purchase or sale of a financial asset under a contract whose terms
require delivery of the asset within the time frame established generally by regulation or marketplace
convention. A regular way purchase or sale of financial assets shall be recognised and derecognised,
as applicable, using trade date accounting.
