Page 86 - SAR141018_Forterra AR 2013

FORTERRA
ANNUAL REPORT 2013
NOTES TO THE
FINANCIAL STATEMENTS
84
3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(e) Financial instruments
(i) Non-derivative financial assets
The Group initially recognises loans and receivables on the date that they are
originated. All other financial assets (including assets designated at fair value through
profit or loss) are recognised initially on the trade date, which is the date that the
Group becomes a party to the contractual provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to the cash
flows from the asset expire, or it transfers the rights to receive the contractual cash
flows on the financial asset in a transaction in which substantially all the risks and
rewards of ownership of the financial asset are transferred. Any interest in transferred
financial assets that is created or retained by the Group is recognised as a separate
asset or liability.
Financial assets and liabilities are offset and the net amount presented in the
statement of financial position when, and only when, the Group has a legal right to
offset the amounts and intends either to settle on a net basis or to realise the asset
and settle the liability simultaneously.
The Group has the following non-derivative financial assets: loans and receivables.
Loans and receivables
Loans and receivables are financial assets with fixed or determinable payments that
are not quoted in an active market. Such assets are recognised initially at fair value
plus any directly attributable transaction costs. Subsequent to initial recognition,
loans and receivables are measured at amortised cost using the effective interest
method, less any impairment losses.
Loans and receivables comprise trade and other receivables (excluding prepayments)
and cash and cash equivalents.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and bank deposits. Cash
equivalents are short-term, highly liquid investments that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes in
value.