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FINANCIAL STATEMENTS, MANAGEMENT AND CORPORATE GOVERNANCE REPORT.
2011
a.2) Financial liabilities held for trading:
A financial liability is considered to be held for trading when:
a) It is issued primarily for the purpose of being repurchased in the short term,
b) It forms 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.
Financial liabilities are initially measured at fair value, which, unless there is evidence to the contrary, is equivalent to the
fair value of the consideration received. Directly attributable transaction costs are directly recognised in the income
statement.
After initial recognition, these assets are measured 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.3) Other financial liabilities 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 financial instrument has been measured at fair value.
This category also includes all financial liabilities 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 by applying different
criteria.
b) A group of financial liabilities or financial assets and liabilities is managed and the return thereon is evaluated on
the basis of its 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.The Company maintained no investments of this type
at year-end 2011 and 2010.
B. Derecognition of financial liabilities
The Company derecognises a financial liability when the obligation under the liability is extinguished.And it also proceeds
to derecognise its own financial liabilities that it acquires, even with a view to reselling them in the future.
When debt instruments are exchanged, provided that their contractual terms are substantially different, the original
financial liability is derecognised and the new financial liability is recognised. Financial liabilities whose contractual terms
are substantially modified are treated in the same way.
The difference between the carrying amount of the derecognised financial asset (or par t of it) and the compensation
paid, including any attributable transaction costs, which also includes any new asset transferred other than cash or liability
assumed, is recognised in the income statement in the year to which it relates.