Avner Oil - Annual Report 2011 - Delek Energy Systems

AVNER OIL EXPLORATION (LIMITED PARTNERSHIP)NOTES TO THE FINANCIAL STATEMENTSNote 2 – Significant Accounting Policies (Continued):A. Financial Assets At Fair Value Through Profit Or Loss:The partnership has financial assets at fair value through profit and loss comprising financial assets held for trading andfinancial assets designated upon initial recognition at fair value through profit or loss, with changes charged to profitand loss.Financial assets are classified as held for trading if they are acquired principally for the purpose of selling orrepurchasing in the near term, if they form part of a portfolio of identified financial instruments that are managedtogether to earn short-term profits or if they are derivatives not designated as hedging instruments. Gains or losses oninvestments held for trading are recognized in profit and loss when incurred.B. Loans And Receivables:The partnership has loans and receivables that are financial assets (non-derivative) with fixed or determinable paymentsthat are not quoted in an active market. After initial recognition, the loans and receivables are measured at amortizedcost using the effective interest method. Short-term credits are reported according to their terms, usually at nominalvalue. Gains or losses are recognized under profit and loss when the loans and receivables are settled or if a provisionfor impairment of value is recognized, according to the method of amortization.2. Financial Liabilities:A. Financial Liabilities Measured At Amortized Cost:Interest bearing loans and other liabilities, are initially recognized at fair value less directly attributable transactioncosts, if any. After initial recognition, loans and bonds, are measured based on their terms at amortized cost using theeffective interest rate method. Short-term borrowings are measured based on their terms, generally at nominal value.Gains and losses are recognized in profit and loss when the financial liability is settled as well as through amortizationB. Financial Liabilities At Fair Value Through Profit Or Loss:Financial liabilities at fair value through profit or loss include financial liabilities classified as held for trading andfinancial liabilities designated upon initial recognition at fair value through profit or loss, with changes charged to profitand loss.Financial liabilities are classified as held for trading if they are acquired principally for the purpose of selling in the nearterm. Gains or losses on liabilities held for trading are charged to profit and loss.-01-