2014 Financial Statement

EDC 2014 Performance Report
Derecognition of Financial Assets and Liabilities
Financial Assets
A financial asset (or where applicable, a part of a financial asset or part of a group of similar
financial assets) is derecognized when:
the right to receive cash flows from the asset has expired;
the Company retains the right to receive cash flows from the asset, but has assumed as
obligation to them in full without material delay to a third party under a “pass through”
arrangement; or
the Company has transferred its right to receive cash flows from the asset and either
(a) has transferred substantially all the risks and rewards of the asset, or (b) has neither
transferred nor retained substantially all the risks and rewards of the asset but has transferred
the control of the asset.
When the Company has transferred its rights to receive cash flows from an asset or has entered
into a “pass-through” arrangement, and has neither transferred nor retained substantially all the
risks and rewards of the asset nor transferred control of the asset, the asset is recognized to the
extent of the Company’s continuing involvement in the asset. Continuing involvement that takes
the form of a guarantee over the transferred asset is measured at the lower of original carrying
amount of the asset and the maximum amount of consideration that the Company could be
required to repay.
Financial Liabilities
A financial liability is derecognized when the obligation under the liability is discharged,
cancelled or expires. When an existing financial liability is replaced by another from the same
lender on substantially different terms, or the terms of an existing liability are substantially
modified, such exchange or modification is treated as a derecognition of the original liability and
the recognition of a new liability, and the difference in the respective carrying amounts is
recognized in the consolidated statement of income.
Offsetting Financial Instruments
Financial assets and financial liabilities are offset and the net amount is reported in the
consolidated statement of financial position if, and only if, there is a currently enforceable legal
right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize
the asset and settle the liability simultaneously. This is not generally the case with master netting
agreements, and the related assets and liabilities are presented at gross in the consolidated
statement of financial position.
Retirement and Other Post-employment Benefits
The Company maintains a funded, non-contributory defined benefits retirement plan. The
Company also provides post-employment medical and life insurance benefits which are unfunded.
The Company recognizes the net defined benefit liability or asset which is the aggregate of the
present value of the defined benefit obligation at the end of the reporting period reduced by the
fair value of plan assets (if any), adjusted for any effect of limiting a net defined benefit asset to
the asset ceiling. The asset ceiling is the present value of any economic benefits available in the
form of refunds from the plan or reductions in future contributions to the plan.
The cost of providing benefits under the defined benefit plans is actuarially determined using the
projected unit credit method.
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