117 / 174
financiAL STATEMENTs
Annual Report 2017
115
NOTES TO THE FINANCIAL STATEMENTS
2.
SIGNIFICANT ACCOUNTING POLICIES (Cont’d.)
2.3 Summary of Significant Accounting Policies (Cont’d.)
(w) Fair Value Measurement (Cont’d.)
The fair value of an asset or a liability is measured using the assumptions that market participants would use when
pricing the asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group and the Company use valuation techniques that are appropriate in the circumstances and for which
sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising
the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised
within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value
measurement as a whole:
-
Level 1 — Quoted (unadjusted) prices in active markets for identical assets or liabilities
-
Level 2 — Other techniques for which all inputs that have a significant effect on the recorded fair value are
observable, either directly or indirectly
-
Level 3 — Techniques that use inputs that have a significant effect on the recorded fair value that are not based
on observable market data
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group and the
Company determine whether transfers have occurred between Levels in the hierarchy by re-assessing categorisation
(based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each
reporting period.
2.4 Significant Accounting Estimates and Judgements
Estimates, assumptions concerning the future and judgements are made in the preparation of the financial statements.
They affect the application of the Group’s accounting policies, reported amounts of assets, liabilities, income and expenses,
and disclosures made. They are assessed on an on-going basis and are based on experience and other relevant factors,
including expectations of future events that are believed to be reasonable under the circumstances. The significant key
assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial
year are discussed below: