Entire Document - Chris Hani District Municipality

6. FINANCIAL INSTRUMENTS (continued)1.1Financial Assets – ClassificationA Financial Asset is any asset that is a cash or contractual right to receive cash.In accordance with GRAP 104 the Financial Assets of the municipality are classifiedas follows into the three categories allowed by this standard:♦Financial Assets measured at Amortised Cost are non-derivative FinancialAssets with fixed or determinable payments that are not quoted in an activemarket. They are included in Current Assets, except for maturities greaterthan 12 months, which are classified as Non-current Assets. Financial Assetsat Amortised Cost are initially recognised at fair value plus transaction coststhat are directly attributable to the acquisition or issue of the Financial Asset.After initial recognition, Financial Assets are measured at amortised cost,using the Effective Interest Rate Method less a provision for impairment.Chapter 4♦♦Financial Assets measured at Fair Value are financial assets that meeteither of the following conditions:(i) Derivatives;(ii) Combined instruments that are designated at fair value;(iii) Instruments held for trading;(iv) Non-derivative Financial Instruments with fixed or determinablepayments that are designated at fair value at initial recognition; or(v) Financial Instruments that do not meet the definition of FinancialInstruments at Amortised Cost or Financial Instruments at Cost.Financial Assets measured at Cost are investments in Residual Interestthat do not have a quoted market price in an active market and whose fairvalue cannot be reliably measured.The municipality has the following types of Financial Assets as reflected on the faceof the Statement of Financial Position or in the Notes thereto:Type of Financial Asset Classification in terms of GRAP 104Long-term ReceivablesReceivables from Exchange TransactionsReceivables from Non-exchange TransactionsBank, Cash and Cash Equivalents – Notice DepositsBank, Cash and Cash Equivalents – Call DepositsBank, Cash and Cash EquivalentsFinancial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Amortised CostFinancial Assets at Fair ValueFinancial Assets at Fair Value255