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FINANCIAL STATEMENTS, MANAGEMENT AND CORPORATE GOVERNANCE REPORT.
2011
Following initial recognition, financial assets included in this category are measured at amor tised cost. Interest is recognised
in the income statement using the effective interest rate method.
Never theless, trade receivables that mature within less than one year with no contractual interest rate, as well as
advances and loans to personnel, dividends receivable and called-up payments on equity instruments, the amount of
which is expected in the shor t term, are carried at nominal value both at initial and subsequent remeasurement, when
the effect of not discounting cash flows is not significant.
Loans and receivables maturing in less than twelve months as of the balance sheet date are classified as current, and
those maturing at over 12 months as non-current.
a.2) Held-to-maturity investments
Held-to-maturity investments include debt instruments with fixed maturities and fixed or determinable payments traded
on active markets and which the Company has the positive intention and the financial capacity to hold to maturity.
Following initial recognition, financial assets included in this category are measured at amor tised cost. Interest is recognised
in the income statement using the effective interest rate method.
a.3) Financial assets held for trading
A financial asset is considered to be held for trading when:
a) It is originated or acquired to be sold in the short term,
b) It is par t of a por tfolio of identified financial instruments that are managed together and for which there is evidence
of a recent pattern of shor t-term profit taking, or
c) It is a derivative financial instrument, providing that is not a financial guarantee contract and has not been designated
as a hedging instrument.
After initial recognition, these assets are stated at fair value including any transaction costs relating to their sale. Changes
to fair value are recognised in the income statement for the year.The Company maintained no investments of this type
at year-end 2011 and 2010.
a.4) Other financial assets at fair value through profit or loss
This category includes hybrid financial instruments, when it is not possible to separately measure the value of the
embedded derivative or to reliably determine its fair value, either at the time of acquisition or at a subsequent date, or,
when so elected, at the time of initial recognition, because the instrument has been measured at fair value.
This category also includes all financial assets that the Company has designated, at the time of initial recognition, for
inclusion.This designation is only made when it results in more relevant information, because:
a) It eliminates or significantly reduces inconsistencies in recognition or valuation that otherwise would exist due to
the measurement of assets or liabilities or due to the recognition of losses or gains thereon through the application
of different criteria.
b) A group of financial assets or financial assets and liabilities is managed and the return thereon is evaluated on the
basis of the assets’ fair value, according to a documented investment or risk-management strategy, and, in addition,
information regarding the Group is provided on a fair-value basis to the key management personnel.
After initial recognition, these assets are stated at fair value including any transaction costs relating to their sale. Changes
to fair value are recognised in the income statement for the year.