The company has chosen to adopt the FRS 102A in respect of financial instruments.
Basic financial assets, including trade and other debtors and cash and bank balances are initially recognised at transaction
price, unless the arrangement constitute a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
At the end of each reporting period, financial assets measured at amortised cost are assessed for objective evidence of
impairment. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present
value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is
recognised in the income statement.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.