✨ Financial Statements Notes
THE WAIKATO COMMUNITY TRUST INCORPORATED
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2013
3.8 Financial Assets
Financial assets are classified into the following specified categories: loans and receivables, financial assets at fair value through profit or loss, derivative financial instruments at fair value through profit or loss, held to maturity investments and, available for sale financial assets. The classification depends on the nature and purpose of the financial assets, is determined at the time of initial recognition and is reviewed regularly.
3.8.1 Loans and Receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except those with maturities greater than 12 months after the balance sheet date. These are classified as non-current assets. The Trust loans and receivables comprise Accounts Receivable and the Sport Waikato Loan.
Loans and receivables are initially recognised at fair value plus transaction costs. After initial recognition, loans and receivables are carried at amortised cost using the effective interest method less impairment.
The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset, or, where appropriate, a shorter period, to the net carrying amount of the financial asset.
When an account receivable is uncollectible, it is written off against an allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss. Thus the carrying value of accounts receivable approximates their fair values.
The Trust assesses at each balance sheet date whether there is objective evidence that a loan or receivable is impaired.
3.8.2 Financial Assets at Fair Value Through Profit or Loss
The Trust classifies its investments as financial assets at fair value through profit or loss. These financial assets are designated by management at fair value through profit or loss at inception. Subsequent to initial recognition, all financial assets at fair value through profit or loss are measured at fair value.
Financial assets designated at fair value through profit or loss at inception are those that are managed and their performance evaluated on a fair value basis in accordance with the Trust documented investment strategy and information is provided to management on that basis.
3.8.3 Derivative Financial Instruments at Fair Value Through Profit or Loss
See Note 3.6.4.
3.8.4 Available for Sale Financial Assets
Available for sale financial assets are non-derivatives that are either designated in this category or not classified in any other categories.
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NZ Gazette 2013, No 109
✨ LLM interpretation of page content
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Financial Statements of The Waikato Community Trust Incorporated
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🏢 State Enterprises & Insurance11 July 2013
Financial statements, Community Trusts, Waikato, Financial Assets, Loans and Receivables, Financial Assets at Fair Value Through Profit or Loss, Derivative Financial Instruments, Available for Sale Financial Assets