59
NOTES TO THE FINANCIAL STATEMENTS
For the financial year ended 31 December 2014
2.
Summary of significant accounting policies (cont’d)
2.12
Financial instruments (cont’d)
(a)
Financial assets (cont’d)
(ii)
Held-to-maturity investments
Non-derivative financial assets with fixed or determinable payments and fixed maturity are classified as held-to-
maturity when the Group has the positive intention and ability to hold the investment to maturity. Subsequent
to initial recognition, held-to-maturity investments are measured at amortised cost using the effective interest
method, less impairment. Gains and losses are recognised in profit or loss when the held-to-maturity investments
are derecognised or impaired, and through the amortisation process.
(iii)
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 are measured 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.
(iv)
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 those which are intended to be held for an indefinite period of time and
which may be sold in response to needs for liquidity or in response to changes in the market conditions.
After initial recognition, available-for-sale financial assets are subsequently measured at fair value. Any gains or
losses from changes in fair value of the financial assets are recognised in other comprehensive income, except
that impairment losses, foreign exchange gains and losses on monetary instruments and interest calculated
using the effective interest method are 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 de-recognised.
Investments in equity instruments whose fair value cannot be reliably measured are measured 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
de-recognition 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.
Regular way purchase or sale of a financial asset
All regular way purchases and sales of financial assets are recognised or derecognised on the trade date i.e., the
date that the Group commits to purchase or sell the asset. Regular way purchases or sales are purchases or sales of
financial assets that require delivery of assets within the period generally established by regulation or convention in the
marketplace concerned.
