Annual Report - QuamIR

Notes to the Consolidated Financial Statements (Continued)
2 Summary of significant accounting policies (Continued)
2.15 Financial assets (Continued)
The Group assesses at each balance sheet date whether there
is objective evidence that a financial asset or a group of financial
assets is impaired. In the case of equity securities classified as
available for sale, a significant or prolonged decline in the fair
value of the security below its cost is considered as an indicator
that the securities are impaired. If any such evidence exists
for available-for-sale financial assets, the cumulative loss –
measured as the difference between the acquisition cost and the
current fair value, less any impairment loss on that financial asset
previously recognised in the consolidated income statement – is
removed from equity and recognised in the consolidated income
statement. Impairment losses recognised in the consolidated
income statement on equity instruments are not reversed through
the consolidated income statement.
2.16 Derivative financial instrument
Derivatives are initially recognised at fair value on the date a
derivative contract is entered into and are subsequently remeasured
at their fair value at each balance sheet date. The
change in the fair value is recognised in the consolidated income
statement.
2.17 Inventories
Inventories are stated at the lower of cost and net realisable
value. Cost is determined using the first-in, first-out (FIFO)
method. The cost of finished goods comprises raw materials,
direct labour, other direct costs and related production
overheads (based on normal operating capacity). It excludes
borrowing costs. Net realisable value is the estimated selling
price in the ordinary course of business, less applicable variable
selling expenses.
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2.15
2.16
2.17
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