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FINANCIAL STATEMENTS
2.6 Financial Assets
2.6.1 Classification
The Company classifies its financial assets in the following categories: at fair value through profit or loss, loans and
receivables, and available for sale. The classification depends on the purpose for which the financial assets were acquired.
Management determines the classification of its financial assets at initial recognition.
a) Financial Assets at Fair Value through Profit or Loss
Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this
category if acquired principally for the purpose of selling in the short term. Derivatives are classified as held for trading
unless they are designated as hedges. Assets in this category are classified as current assets.
b) 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 for maturities greater than 12 months after the balance sheet
date. These are classified as non-current assets. Loans and receivables are classified as trade and other receivables in the
balance sheet.
c) 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 of
the other categories. They are included in non-current assets unless management intends to dispose of the investment
within 12 months of the balance sheet date.
2.6.2 Recognition and measurement
Regular purchases and sales of financial assets are recognised on the trade-date – the date on which the Company
commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial
assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss is initially
recognised at fair value, and transaction costs are expensed in the income statement. Financial assets are derecognised
when the rights to receive cash flows from the investments have expired or have been transferred and the Company has
transferred substantially all risks and rewards of ownership. Available-for-sale financial assets and financial assets at fair
value through profit or loss are subsequently carried at fair value. Loans and receivables are carried at amortised cost
using the effective interest method.
Gains or losses arising from changes in the fair value of the “financial assets at fair value through profit or loss” category
are presented in the income statement within other (losses)/gains – net, in the period in which they arise. Dividend income
from financial assets at fair value through profit or loss is recognised in the income statement as part of other income
when the Company’s right to receive payments is established.
Changes in the fair value of monetary securities denominated in a foreign currency and classified as available-for-sale are
analysed between translation differences resulting from changes in amortised cost of the security and other changes in
the carrying amount of the security. The translation differences on monetary securities are recognised in profit or loss;
translation differences on non-monetary securities are recognised in equity. Changes in the fair value of monetary and
non-monetary securities classified as available for sale are recognised in equity.
Financial Statements as at 31 December 2009 (Amounts in Euros unless otherwise stated) PAGE 27 OF 69
2.6 Financial Assets
2.6.1 Classification
The Company classifies its financial assets in the following categories: at fair value through profit or loss, loans and
receivables, and available for sale. The classification depends on the purpose for which the financial assets were acquired.
Management determines the classification of its financial assets at initial recognition.
a) Financial Assets at Fair Value through Profit or Loss
Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this
category if acquired principally for the purpose of selling in the short term. Derivatives are classified as held for trading
unless they are designated as hedges. Assets in this category are classified as current assets.
b) 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 for maturities greater than 12 months after the balance sheet
date. These are classified as non-current assets. Loans and receivables are classified as trade and other receivables in the
balance sheet.
c) 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 of
the other categories. They are included in non-current assets unless management intends to dispose of the investment
within 12 months of the balance sheet date.
2.6.2 Recognition and measurement
Regular purchases and sales of financial assets are recognised on the trade-date – the date on which the Company
commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial
assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss is initially
recognised at fair value, and transaction costs are expensed in the income statement. Financial assets are derecognised
when the rights to receive cash flows from the investments have expired or have been transferred and the Company has
transferred substantially all risks and rewards of ownership. Available-for-sale financial assets and financial assets at fair
value through profit or loss are subsequently carried at fair value. Loans and receivables are carried at amortised cost
using the effective interest method.
Gains or losses arising from changes in the fair value of the “financial assets at fair value through profit or loss” category
are presented in the income statement within other (losses)/gains – net, in the period in which they arise. Dividend income
from financial assets at fair value through profit or loss is recognised in the income statement as part of other income
when the Company’s right to receive payments is established.
Changes in the fair value of monetary securities denominated in a foreign currency and classified as available-for-sale are
analysed between translation differences resulting from changes in amortised cost of the security and other changes in
the carrying amount of the security. The translation differences on monetary securities are recognised in profit or loss;
translation differences on non-monetary securities are recognised in equity. Changes in the fair value of monetary and
non-monetary securities classified as available for sale are recognised in equity.
Financial Statements as at 31 December 2009 (Amounts in Euros unless otherwise stated) PAGE 27 OF 69
