NOTES TO THE FINANCIAL STATEMENTS
For the Financial Year Ended 31 December 2014
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
2.32 DE-RECOGNITION OF FINANCIAL ASSETS AND LIABILITIES
(a)
FINANCIAL ASSETS
A financial asset is de-recognised where the contractual right to receive cash flows from the assets has expired.
On de-recognition of a financial asset in its entirety, the difference between the carrying amount and the sum
of the consideration received and any cumulative gain or loss that had been recognised in other comprehensive
income is recognised in profit or loss.
(b)
FINANCIAL LIABILITIES
A financial liability is de-recognised when the obligation under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another from the same lender on substantially different terms,
or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a
de-recognition of the original liability and the recognition of a new liability, and the difference in the respective
carrying amounts is recognised in profit or loss.
2.33 OFFSETTING OF FINANCIAL INSTRUMENTS
Financial assets and financial liabilities are offset and the net amount is presented in the balance sheets, when and only
when, there is a currently enforceable legal right to set off the recognised amounts and there is an intention to settle on
a net basis, or to realise the assets and settle the liabilities simultaneously.
2.34 TRANSFERS BETWEEN LEVELS OF THE FAIR VALUE HIERARCHY
Transfers between levels of the fair value hierarchy are deemed to have occurred on the date of the event or change in
circumstances that caused the transfers.
2.35 CONTINGENCIES
A contingent liability is:
(a)
a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence
or non-occurrence of one or more uncertain future events not wholly within the control of the Group; or
(b)
a present obligation that arises from past events but is not recognised because:
(i)
It is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or
(ii)
The amount of the obligation cannot be measured with sufficient reliability.
A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the
occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group.
Contingent liabilities and assets are not recognised on the balance sheet of the Group, except for contingent liabilities
assumed in a business combination that are present obligations and which the fair values can be reliably determined.
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THE STRAITS TRADING COMPANY LIMITED ANNUAL REPORT 2014
