Annual Report 2012 - TodayIR.com
Annual Report 2012 - TodayIR.com
Annual Report 2012 - TodayIR.com
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Lonking Holdings Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2012</strong><br />
Notes to the Consolidated Financial Statements<br />
For the year ended 31 December <strong>2012</strong><br />
2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)<br />
Investments and other financial assets<br />
Initial recognition and measurement<br />
Financial assets within the scope of HKAS 39 are classified as loans and receivables, or as derivatives<br />
designated as hedging instruments in an effective hedge, as appropriate. The Group determines<br />
the classification of its financial assets at initial recognition. When financial assets are recognised<br />
initially, they are measured at fair value, plus transaction costs, except in the case of financial assets<br />
recorded at fair value through profit or loss.<br />
All regular way purchases and sales of financial assets are recognised on the trade date, that is,<br />
the date that the Group <strong>com</strong>mits to purchase or sell the asset. Regular way purchases or sales are<br />
purchases or sales of financial assets that require delivery of assets within the period generally<br />
established by regulation or convention in the marketplace.<br />
Subsequent measurement<br />
The subsequent measurement of financial assets depends on their classification as follows:<br />
Loans and receivables<br />
Loans and receivables are non-derivative financial assets with fixed or determinable payments<br />
that are not quoted in an active market. After initial measurement, such assets are subsequently<br />
measured at amortised cost using the effective interest rate method less any allowance for<br />
impairment. Amortised cost is calculated by taking into account any discount or premium on<br />
acquisition and includes fees or costs that are an integral part of the effective interest rate. The<br />
effective interest rate amortisation is included in other in<strong>com</strong>e and gains in profit or loss. The<br />
loss arising from impairment is recognised in profit or loss in finance costs for loans and in other<br />
expenses for receivables.<br />
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