Annual report 2012 - Comrod

Annual report 2012 23/92Strategies and values | Group | Parent company | Corporate governance | ContactAnnual report Financial statement NotesFinancial assets at fair value through profit or lossThis category includes derivative financialinstruments entered into by the Group that arenot designated as hedging instruments in hedgerelationships as defined by IAS 39. Financialassets at fair value through profit and loss arecarried in the statement of financial position atfair value with changes in fair value recognized inprofit and loss.Loans and receivablesThis category includes trade and other receivablescarried at amortised cost or at nominal amountless provision for bad debt were this can beregarded as a reasonable proxy for fair value.Financial liabilitiesInitial recognitionFinancial liabilities within the scope of IAS 39are classified as financial liabilities at fair valuethrough profit or loss, or other liabilities. TheGroup determines the classification of its financialliabilities at initial recognition.Financial liabilities are recognised initially at fairvalue less, in the case of other liabilities, directlyattributable transaction costs.The Group’s financial liabilities include trade andother payables, bank overdraft, interest bearingdebt and derivative financial instruments.Subsequent measurementThe measurement of financial liabilities dependson their classification as follows:Financial liabilities at fair value through profit orlossThis category includes derivative financialinstruments entered into by the Group that donot meet the hedge accounting criteria as definedby IAS 39. Gains or losses on liabilities held fortrading are recognised in profit and loss.Other liabilitiesAfter initial recognition, interest bearing debt issubsequently measured at amortised cost usingthe effective interest rate method. Gains andlosses are recognised in the income statementwhen the liabilities are derecognised as well asthrough the amortisation process. The calculationtakes into account any premium or discount onacquisition and includes transaction costs andfees that are an integral part of the effectiveinterest rate.Offsetting of financial instrumentsFinancial assets and financial liabilities are offsetand the net amount reported in the consolidatedbalance sheet if, and only if, there is a currentlyenforceable legal right to offset the recognisedamounts and there is an intention to settle on anet basis, or to realise the assets and settle theliabilities simultaneously.Impairment of financial assetsThe Group assesses at each balance sheet datewhether there is any objective evidence that afinancial asset or a group of financial assets isimpaired. A financial asset or a group of financialassets is deemed to be impaired if, and only if,there is objective evidence of impairment as aresult of one or more events that has occurredafter the initial recognition of the asset (anincurred ‘loss event’) and that loss event has animpact on the estimated future cash flows of thefinancial asset or the group of financial assets that23