Singapore Airlines 2016 Annual Report Download - page 126

Notes to the Financial Statements
31 March 2016
2 Summary of Significant Accounting Policies (continued)
(l) Financial assets (continued)
(i) Financial assets at fair value through profit or loss
Financial assets measured at fair value through profit or loss include financial assets held for trading and those designated upon
initial recognition as fair value through profit or loss. Financial assets are classified as held for trading if they are acquired principally
for the purpose of selling in the short-term. This category includes derivative financial instruments entered into by the Group that
are not designated as hedging instruments in hedge relationships as defined by FRS 39. Derivatives are also classified under this
category unless they are designated as eective hedging instruments. Gains or losses on financial assets held at fair value through
profit or loss are recognised in the profit and loss account.
Assets in this category are classified as current assets if they are either held for trading or are expected to be realised within
12 months aer the end of the reporting period.
(ii) Loans and receivables
Non-derivative financial assets with fixed or determinable payments that are not quoted in an active market are classified as loans
and receivables. Such assets are carried at amortised cost using the eective interest method, less impairment. Gains and losses
are recognised in the profit and loss account when the loans and receivables are derecognised or impaired, as well as through the
amortisation process.
(iii) Held-to-maturity investments
Non-derivative financial assets with fixed or determinable payments and fixed maturity are classified as held-to-maturity when the
Group has the positive intention and ability to hold the investment to maturity. Subsequent to initial recognition, held-to-maturity
investments are measured at amortised cost using the eective interest method, less impairment. Gains and losses are recognised
in the profit and loss account when the held-to-maturity investments are derecognised or impaired, and through the amortisation
process.
(iv) Available-for-sale investments
Available-for-sale investments are non-derivative financial assets that are either designated in this category, or not classified in
any other categories. Aer initial recognition, available-for-sale investments are measured at fair value with gains or losses being
recognised in other comprehensive income, except that impairment losses and interest are recognised in the profit and loss account.
The cumulative gain or loss previously recognised in other comprehensive income is reclassified from equity to the profit and loss
account as a reclassification adjustment when the investment is derecognised.
(m) Investments
Investments held by the Group are classified as available-for-sale or held-to-maturity. Investments classified as available-for-sale are
stated at fair value. Those investments where their fair values cannot be reliably measured are stated at cost less accumulated impairment
losses. Fair value is determined in the manner described in Note 37. Held-to-maturity investments are measured at amortised cost using
the eective interest method, less impairment. The accounting policy for both categories of financial assets is stated in Note 2(l).
(n) Trade debtors and other receivables
Trade debtors, including amounts owing by subsidiary, associated and joint venture companies, deposits and other debtors are classified
and accounted for as loans and receivables. Other non-current receivables are also classified and accounted for in the same way. The
accounting policy for this category of financial assets is stated in Note 2(l).
Further details on the accounting policy for impairment of financial assets are stated in Note 2(q).
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