for the year ended 31 December 2016
NOTES TO THE
FINANCIAL STATEMENTS
Annual Report 2016
-
92
-
2.
Summaryofsignificantaccountingpolicies (cont’d)
2.9
Financial instruments (cont’d)
(a)
Financial assets (cont’d)
Subsequentmeasurement
The subsequentmeasurement of financial assets depends on their classification as follows:
(i)
Loans and receivables
Non-derivative financial assets with fixed or determinable payments that are not quoted in
an active market are classified as loans and receivables. Subsequent to initial recognition,
loans and receivables aremeasured at amortised cost using the effective interest method, less
impairment. Gains and losses are recognised in profit or loss when the loans and receivables
are derecognised or impaired, and through the amortisation process.
(ii)
Available-for-sale financial assets
Available-for-sale financial assets include equity and debt securities. Equity investments
classified as available-for-sale are those, which are neither classified as held for trading nor
designated at fair value through profit or loss. Debt securities in this category are thosewhich
are intended to be held for an indefinite period of time andwhichmay be sold in response to
needs for liquidity or in response to changes in themarket conditions.
After initial recognition, available-for-sale financial assets are subsequentlymeasured at fair
value.Anygainsor lossesfromchanges infairvalueof thefinancialassetarerecognised inother
comprehensive income, except that impairment losses, foreign exchange gains and losses on
monetary instruments and interest calculatedusing theeffective interestmethodare recognised
in profit or loss. The cumulative gain or loss previously recognised in other comprehensive
income is reclassified from equity to profit or loss as a reclassification adjustment when the
financial asset is derecognised.
Investments in equity instrumentswhose fair value cannot be reliablymeasured aremeasured at cost
less impairment loss.
De-recognition
A financial asset is derecognised where the contractual right to receive cash flows from the asset
has expired. On derecognition of a financial asset in its entirety, the difference between the carrying
amount and the sum of the consideration received and any cumulative gain or loss that had been
recognised in other comprehensive income is recognised in profit or loss.
