Page 186 - SC SCAR 2023 ENGLISH Flipbook
P. 186

                                 PART 5 ORGANISATION INFORMATION
 Changes on fair value of investments in fixed income securities that are subsequently measured at FVTPL are recognised in the statement of profit or loss and other comprehensive income in the period in which they arise.
Subsequent measurement
Financial assets designated at FVTPL are remeasured at each reporting date. The fair values are determined by reference to observable market prices provided by independent pricing sources.
Expected Credit Loss
The SC assesses credit risk on financial instruments measured at FVTPL. Credit risk represents the risk of financial loss arising from the counterparty’s failure to meet its contractual obligations.
For financial instruments subject to credit risk, the SC estimates expected credit losses by considering historical credit loss experience, current market conditions, and forward-looking information. The estimation is performed on a collective or individual basis, depending on the characteristics of the financial instrument.
Expected credit losses are recognised as a component of the carrying amount of the financial instruments. The assessment is based on the present value of all cash shortfalls over the expected life of the instrument, considering the probability-weighted outcomes of different scenarios as disclosed in Note 3(f)(i).
Financial liabilities
Amortised cost
Financial liabilities not categorised as fair value through profit or loss are subsequently measured at amortised cost using the effective interest method.
Finance cost is recognised in the profit or loss. Any gains or losses on derecognition are also recognised in the profit or loss.
(iii) Derecognition
A financial asset or part of it is derecognised when, and only when, the contractual rights to the cash flows from the financial asset expire or are transferred, or control of the asset is not retained or substantially all of the risks and rewards of ownership of the financial asset are transferred to another party. On derecognition of a financial asset, the difference between the carrying amount and the sum of the consideration received (including any new asset obtained less any new liability assumed) is recognised in the profit or loss.
A financial liability or a part of it is derecognised when, and only when, the obligation specified in the contract is discharged, cancelled or expires. A financial liability is also derecognised when its terms are modified and the cash flows of the modified liability are substantially different, in which case, a new financial liability based on modified terms is recognised at fair value. On derecognition of a financial liability, the difference between the carrying amount of the financial liability extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss.
(iv) Offsetting
Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when, and only when, the SC currently has a legally enforceable right to set off the amounts and it intends either to settle them on a net basis or to realise the asset and liability simultaneously.

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