| The company only enters into Basic financial instrument transactions.
Financial instruments are recognised in the company's balance sheet when the company
becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements,
when there is a legally enforceable right to set off the recognised amounts and there is an intention
to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at
transaction price including transaction costs and are subsequently carried at amortised cost using the
effective interest method unless the arrangement constitutes a financing transaction, where the
transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Financial liabilities and equity instruments are classified according to the substance of the contractual
arrangements entered into. An equity instrument is any contract that evidences a residual interest in
the assets of the company after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and
preference shares that are classified as debt, are initially recognised at transaction price unless the
arrangement constitutes a financing transaction, where the debt instrument is measured at the present
value of the future payments discounted at a market rate of interest. |