Accounting Policies continued AFRICAN DAWN 52 ANNUAL REPORT 2015 1.17 Financial instruments Financial instruments, as reflected on the statement of financial position, include all financial assets, financial liabilities, and equity instruments. They exclude prepayments, deferred income, investments in subsidiaries, investments in associates, property and equipment, deferred taxation, taxation receivable / payable, provisions, intangible assets and goodwill. Financial instruments are accounted for under IAS 32 - Financial Instruments: Presentation and IAS 39 - Financial Instruments: Recognition and Measurement and IFRS 7 Financial Instruments: Disclosures. The Group has the following financial instruments: • Other financial assets • Loans to group companies • Trade receivables • Other receivables • Cash and cash equivalents • Borrowings • Loans from group companies • Loans from directors • Trade payables • Other payables • Properties in possession (refer to note 1.15) All disclosures required by IFRS 7 can be found in note 44. Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term, highly liquid investments maturing within 90 days from the date of acquisition that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. Cash and cash equivalents are stated at cost which approximates fair value due to the short-term nature of these instruments. Initial recognition Financial instruments are recognised in the statement of financial position when the Group becomes a party to the contractual provisions of a financial instrument. All purchases of financial assets that require delivery within the timeframe established by regulation or market convention (‘regular way’ purchases) are recognised at the trade date, which is the date on which the Group commits to purchase the financial asset. The liability to pay for ‘regular way’ purchases of financial assets is recognised on the trade date, which is when the Group becomes a party to the contractual provisions of the financial instrument. Derecognition Financial assets The Group derecognises a financial asset (or group of financial assets) or a part of a financial asset (or part of a group of financial assets) when: • The contractual rights to the cash flows arising from the financial asset have expired; or • The Group transfers the financial asset, including substantially all the risks and rewards of ownership of the asset or; • It transfers the contractual rights to receive the cash flows from the financial asset; or • It retains the contractual rights to receive the cash flows of the financial asset, but assumes a corresponding contractual obligation to pay the cash flows to one or more recipients, and consequently transfers substantially all the risks and benefits associated with the asset; or • No future economic benefits are expected from their use.
AFRICAN DAWN 2015 Annual Report
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