3 SIGNIFICANT ACCOUNTING POLICIES
(continued)
3.4 Foreign currency transactions
(continued)
• a financial liability designated as a hedge of the net investment in a foreign operation
to the extent that the hedge is effective; or
• qualifying cash flow hedges to the extent the hedge is effective.
3.5 Financial instruments
Non-derivative financial assets
The Group initially recognises loans and receivables on the date that they are originated.
All other financial assets (including assets designated at fair value through profit or loss)
are recognised initially on the trade date at which the Group becomes a party to the
contractual provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to the cash flows
from the asset expire, or it transfers the rights to receive the contractual cash flows on the
financial asset in a transaction in which substantially all the risks and rewards of
ownership of the financial asset are transferred. Any interest in transferred financial assets
that is created or retained by the Group is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net amount presented in the statement of
financial position when, and only when, the Group has a legal right to offset the amounts
and intends either to settle on a net basis or to realise the asset and settle the liability
simultaneously.
The Group has the following non-derivative financial assets: loans and receivables.
Loans and receivables
Loans and receivables are financial assets with fixed or determinable payments that are
not quoted in an active market. Such assets are recognised initially at fair value plus any
directly attributable transaction costs. Subsequent to initial recognition, loans and
receivables are measured at amortised cost using the effective interest method, less any
impairment losses.
Loans and receivables comprise trade and other receivables, loans to joint ventures and
cash and cash equivalents.
Cash and cash equivalents comprise cash balances and bank deposits.
Non-derivative financial liabilities
The Group initially recognises all other financial liabilities (including liabilities designated
at fair value through profit or loss) on the trade date at which the Group becomes a party
to the contractual provisions of the instrument.
The Group derecognises a financial liability when its contractual obligations are
discharged, cancelled or expired.
The Group has the following non-derivative financial liabilities: interest-bearing
borrowings, trade and other payables and security deposits.
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