Annual Report 2015
FINANCIAL SECTION
119
3 PRINCIPAL ACCOUNTING POLICIES
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(h) Investments
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(i) Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are financial assets held for trading and those
designated as at fair value through profit or loss at inception under certain circumstances. A financial
asset is classified in this category if acquired principally for the purpose of selling in the short-term or if
so designated by management. Assets in the category are classified as current assets are expected to be
settled within 12 months; otherwise, they are classified as non-current.
(ii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are
not quoted in an active market. They arise when the Group provides money, goods or services directly to
a debtor with no intention of trading the receivable and are included in current assets, except for those
with maturities more than 12 months after the end of the reporting period, which are classified as non-
current assets.
(iii) Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments
and fixed maturities that management has the positive intention and ability to hold to maturity. Held-to-
maturity financial assets are included in non-current assets, except for those with maturities less than 12
months from the end of the reporting period, which are classified as current assets.
(iv) Available-for-sale financial assets
Available-for-sale financial assets are non-derivatives that are either designated in this category or not
classified in any of the other categories. They are included in non-current assets unless management
intends to dispose of the investment within 12 months of the end of the reporting period.
Regular ways of purchases and sales of financial assets are recognised on trade-date, which is the date on
which the Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus
transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets carried
at fair value through profit or loss are initially recognised at fair value and transaction cost are expensed in the
consolidated income statement. Financial assets are derecognised when the rights to receive cash flows from
the investments have expired or have been transferred and the Group has transferred substantially all risks
and rewards of ownership.
Available-for-sale financial assets and financial assets at fair value through profit or loss are subsequently
carried at fair value. Loans and receivables and held-to-maturity investments are carried at amortised cost using
the effective interest method.
Gains and losses arising from changes in the fair value of the financial assets at fair value through profit or loss
are included in the consolidated income statement in the financial period in which they arise. Changes in the
fair value of available-for-sale financial assets are recognised in other comprehensive income. When available
-for-sale financial assets are sold, the accumulated fair value adjustments are included in the consolidated
income statement as gains or losses from financial assets. Changes in the fair value of monetary financial
assets denominated in a foreign currency and classified as available-for-sale are analysed between translation
differences resulting from changes in amortised cost of the financial asset and other changes in the carrying
amount of the financial asset. The translation differences on monetary financial assets are recognised in the
consolidated income statement; translation differences on non-monetary financial assets are recognised in
other comprehensive income.
