For the financial year ended 31 December 2015
65
ANNUAL REPORT 2015
2. SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
(i) Financial assets
(1) Classification
The Group classifies its investments in financial assets in the following categories: loans and receivables, and
available-for-sale. The classification depends on the nature of the asset and the purpose for which the assets
have been acquired. Management determines the classification of its financial assets at initial recognition.
(i) Loans and receivables
Loans and receivables (excluding prepayments) are non-derivative financial assets with fixed or
determinable payments that are not quoted in an active market. They are presented as current assets,
except those maturing later than 12 months after the end of the reporting period which are classified
as non-current assets. Loans and receivables are presented as “trade and other receivables” (Note 17)
and “cash and bank balances” (Note 18) on the statement of financial position.
(ii) Financial assets, available-for-sale
Financial assets, available-for-sale are non-derivatives that are either designated in this category or not
classified in any of the other categories.
(2) Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date - the date on which the
Group commits to purchase or sell the asset.
Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired
or have been transferred and the Group has transferred substantially all risks and rewards of ownership.
On disposal of a financial asset, the difference between the net sale proceeds and its carrying amount
is recognised in profit or loss. Any amount previously recognised in other comprehensive income and
accumulated in the fair value reserve relating to that asset is reclassified to profit or loss.
(3) Initial measurement
Financial assets are initially recognised at fair value plus transaction costs.
(4) Subsequent measurement
Available-for-sale financial assets are subsequently carried at fair value. Loans and receivables are subsequently
carried at amortised cost using the effective interest method. Interest income on bank deposits is recognised
on a time proportion basis in profit or loss using the effective interest method.
Changes in fair values of available-for-sale equity securities (i.e. non-monetary items) denominated in foreign
currencies are recognised in other comprehensive income and accumulated in the fair value reserve, together
with the related currency translation differences. Dividend income from available-for-sale financial assets is
recognised separately in profit or loss when the right to receive payment is established.
NOT E S TO T H E F I NAN C I A L S TAT EME N T S
(CONTINUED)
