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The company only enters into basic financial instrument transactions that result in the recognition of
financial assets and liabilities like trade and other debtors and creditors, loans from banks and other
third parties, loans to related parties and investments in non-puttable ordinary shares
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 financial transaction, where the
transaction is measured at the present value of the future receipts discounted at a market rate of
interest. Financial Assets classified as receivable within one year are not amortised.
Financial assets are derecognised only when contractual rights to the cash flows from the asset expire
or are settled, or when the company transfers the financial asset and subsequently all the risks and
rewards of ownership to another entity, or if some significant risks and rewards of ownership are
retained but control of the asset has transferred to another party that is able to sell the asset in its
entirety to an unrelated third party.
Basic financial liabilities, including trade and other creditors, bank loans and other loans, are initially
recognised at transaction price unless the arrangement constitutes a financial transaction, where the
debt instrument is measured at the present value of the future receipts discounted at a market rate of
interest.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Financial assets and liabilities are derecognised when the contractual rights to the cash flows from the
asset expire or are settled and when the company's contractual obligations expire or are discharged or
cancelled.
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