Osim FR 050407.indd

Notes to the Financial Statements - 31 December 2006 (cont’d)2. Summary of significant accounting policies (cont’d)2.15 Impairment of financial assetsThe Group assesses at each balance sheet date whether there is any objective that a fi nancial asset or group of fi nancialassets is impaired.a) Assets carried at amortised costIf there is objective evidence that an impairment loss on fi nancial assets carried at amortised cost has been incurred,the amount of the loss is measured as the difference between the asset’s carrying amount and the present value ofestimate future cash fl ows discounted at the fi nancial asset’s original effective interest rate. The carrying amount ofthe asset is reduced through the use of an allowance account. The amount of the loss is recognised in the profi t andloss account.If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectivelyto an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed.Any subsequent reversal of an impairment loss is recognised in the profi t and loss account, to the extent that thecarrying value of the asset does not exceed its amortised cost at the reversal date.b) Assets carried at costIf there is objective evidence that an impairment loss on a fi nancial asset carried at cost has been incurred, the amountof the loss is measured as the difference between the asset’s carrying amount and the present value of estimatedfuture cash fl ows discounted at the current market rate of return for a similar fi nancial asset. Such impairment lossesare not reversed in subsequent periods.c) Available-for-sales financial assetsIf an available-for-sale fi nancial asset is impaired, an amount comprising the difference between its cost (net of anyprincipal payment and amortisation) and its current fair value, less any impairment loss previously recognised in theprofi t and loss account, is transferred from equity to the profi t and loss account. Reversals of impairment loss inrespect of equity instruments are not recognised in the profi t and loss account. Reversals of impairment losses ondebt instruments are reversed through the profi t and loss account, if the increase in fair value of the instrument canbe objectively related to an event occurring after the impairment loss was recognised in the profi t and loss account.Notes to the Financial Statements 97Annual Report 2006