LensCrafters 2011 Annual Report Download - page 190

ANNUAL REPORT 2011> 114 |
non-current assets. The Group’s loans and receivables are comprised of trade and
other receivables. Loans and receivables are initially measured at their fair value plus
transaction costs. After initial recognition, loans and receivables are measured at
amortized cost, using the effective interest method.
(c) Financial assets available for sale
Available-for-sale financial assets are non-derivative financial assets that are
either designated in this category or not classified in any of the other categories.
They are included in non-current assets unless the investment matures or
management intends to dispose of it within 12 months of the end of the reporting
period. Financial assets available for sale are initially measured at their fair value
plus transaction costs. After initial recognition, financial assets available for
sale are carried at fair value. Any changes in fair value are recognized in other
comprehensive income.
Dividend income from financial assets held for sale is recognized in the consolidated
statement of income as part of other income when the Group’s right to receive
payments is established.
A regular way purchase or sale of financial assets is recognized using the settlement date.
Financial assets are derecognized when the rights to receive cash flows from the investments
have expired or have been transferred and the Group has transferred substantially all risks
and rewards of ownership.
The fair value of listed financial instruments is based on the quoted price on an active
market. If the market for a financial asset is not active (or if it refers to non-listed securities),
the Group defines the fair value by utilizing valuation techniques. These techniques include
using recent arms-length market transactions between knowledgeable willing parties, if
available, reference to the current fair value of another instrument that is substantially the
same, discounted cash flows analysis, and pricing models based on observable market
inputs, which are consistent with the instruments under valuation.
The valuation techniques are primarily based on observable market data as opposed to
internal sources of information.
At each reporting date, the Group assesses whether there is objective evidence that a
financial asset is impaired. In the case of investments classified as financial assets held
for sale, a prolonged or significant decline in the fair value of the investment below its
cost is also considered an indicator that the asset is impaired. If any such evidence exists
for an available-for-sale financial asset, the cumulative loss, measured as the difference
between the cost of acquisition and the current fair value, net any impairment loss
previously recognized in the consolidated statement of income, is removed from equity
and recognized in the consolidated statement of income.
Any impairment loss recognized on investment classified as available-for-sale financial
asset is not reversed.