FINANCIALS
KU
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3 . Summary of Accounting Policies ( continued )
d ) Goods and services tax ( GST ) Revenues , expenses and assets are recognised net of the amount of goods and services tax ( GST ), except :
i ) where the amount of GST incurred is not recoverable from the taxation authority , it is recognised as part of the cost of acquisition of an asset or as part of an item of expense ; or
ii ) for receivables and payables which are recognised inclusive of GST .
The net amount of GST recoverable from , or payable to , the taxation authority is included as part of receivables or payables .
Cash flows are included in the cash flow statement on a gross basis . The GST component of cash flows arising from investing and financing activities which is recoverable from , or payable to , the taxation authority is classified as operating cash flows .
e ) Financial Assets All financial assets are initially stated at cost , being the fair value of consideration given plus acquisition costs . Purchases and sales of financial assets are recognised on trade date which is the date on which the Company commits to purchase or sell the asset . Accounting policies for each category of financial assets subsequent to initial recognition are set out below :
Loans and receivables Trade receivables , loans , and other receivables are recorded at amortised cost using the effective interest rate method less impairment . Impairment losses are measured as the difference between the investment ’ s carrying amount and the present value of estimated future cash flows , excluding future credit losses that have not been incurred . The cash flows are discounted at the investment ’ s original effective interest rate . Impairment losses are recognised in profit or loss .
Available-for-sale financial assets Available-for-sale investments are those financial assets that are designated as availablefor-sale . When available-for-sale financial investments are recognised initially , they are measured at fair value . Any available-for-sale financial investments donated to the Company are recognised at fair value at the date the Company obtains control of the asset .
After initial recognition available-for-sale financial investments are measured at fair value with gains or losses being recognised in other comprehensive income until the investment is derecognised or until the investment is determined to be impaired , at which time the cumulative gain or loss previously recognised in other comprehensive income is reclassified to the Statement of Comprehensive Income .
The fair value of investments that are actively traded in organised financial markets is determined by reference to quoted market bid prices at the close of business on the reporting date . For investments with no active market , fair value is determined using valuation techniques . Such techniques include using recent arm ’ s length market transactions , reference to the current market value of another instrument that is substantially the same , discounted cash flow analysis , and option pricing models .
Impairment of financial assets Financial assets , other than those at fair value through profit or loss , are assessed for indicators of impairment at each balance date . Financial assets are impaired where there is objective evidence that as a result of one or more events that occurred after the initial recognition of the financial asset the estimated future cash flows of the investment have been impacted .
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