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As in prior years, during the year ended 31 December 2008 the Group did not transfer any financial assets that did
not involve transferring or retaining substantially all the risks and benefits deriving from their ownership.
If, as the result of a transfer, a financial asset is derecognised in full but, as a consequence, the Group obtains a
new financial asset or accepts a new financial liability, the Group recognises at fair value such new financial asset,
financial liability or liability originating from the service.
Financial liabilities
Financial liabilities are derecognised when the underlying obligation is eliminated, cancelled or settled.
If an existing financial liability is replaced by another from the same lender on substantially different terms, or the
conditions applying to an existing liability are modified significantly, this replacement or modification is recorded
by eliminating the original liability and recognising a new liability. Any differences between the carrying amounts
concerned are reflected in the income statement.
Impairment of financial assets
At each accounting reference date, the Group determines if the value of a financial asset or a group of financial
assets is impaired.
Assets measured on an amortised-cost basis
If there is objective evidence that the value of a loan or receivable measured at amortised cost is impaired, the
related loss is calculated as the difference between the carrying amount of the asset and the present value of
estimated future cash flows (excluding any collection losses not yet incurred), discounted using the original
effective interest rate applying to the financial asset (being the effective interest rate determined at the time of
initial recognition). The carrying amount of the asset is reduced both directly and via the recording of provisions.
The loss is charged to the income statement.
The Group firstly looks for objective evidence of impairment in relation to individually significant financial
assets, and then considers the position individually and collectively in relation to financial assets that are not
significant.
In the absence of objective evidence of impairment in the value of financial assets considered individually,
whether significant or otherwise, such assets are then included in a group of financial assets with similar credit
risk characteristics which is subjected to impairment testing on a collective basis. Assets measured individually,
for which impairment has been or continues to be identified, are not included in the collective tests.
If, in subsequent years, the extent of impairment decreases due, objectively, to an event arising after the earlier
loss in value was recognised, the amount previously written down may be reinstated. Subsequent write-backs
are credited to the income statement, to the extent that the carrying amount of the asset does not exceed its
amortised cost at the write-back date.
Assets measured at cost
If there is objective evidence of the impairment of an unlisted equity investment that is not measured at fair value,
since its fair value cannot be measured reliably, or of a derivative associated with that equity instrument that must
be settled by delivery of such instrument, the impairment loss is calculated as the difference between the carrying
amount of the asset and the present value of estimated future cash flows, discounted using the current market
yield for a similar financial asset.
Available-for-sale financial assets
If the value of available-for-sale financial assets is impaired, the difference between their cost (net of repayments
of principal and amortisation) and their current fair value, net of any earlier impairment charged to the income
statement, is reclassified from shareholders' equity to the income statement. Write-backs in the value of equity
instruments classified as available for sale are not reflected in the income statement. Write-backs in the value of
debt instruments are credited to the income statement if, objectively, the increase in their fair value is related to
an event arising after the earlier loss in value was recognised in the income statement.