Classification
The company holds the following financial instruments:
- Short-term trade and other debtors and creditors;
- Bank loans; and
- Cash and bank balance
All financial instruments and classified as basic.
Recognition and measurement
The company has chosen to apply the recognition and measurement principles in FRS102.
Financial instruments are recognised when in the cash of assets, the contractual rights to cash flows from the assetsexpire or substantially all the risks and rewards of ownership are transferred to another party, or in the cash of liabilities,when the company's obligations are discharged, expire or are cancelled.
Except for bank loans, such instruments are initially measured at transaction price, including transaction costs, and aresubsequently carried at the undiscounted amount of the cash or other consideration expected to be paid or received, aftertaking account of impairment adjustments.
Bank loans are initially measured at transaction price, including transaction costs, and are subsequently carried atamortised cost using the effective interest method.