Basic HTML Version
Annual Report 2013
KPJ HEALTHCARE BERHAD
189
2.
Summary of signi cant accounting policies (continued)
2.16 Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and on hand, demand deposits, and short-term, highly liquid investments that are
readily convertible to known amounts of cash and which are subject to an insigni cant risk of changes in value. These also include
bank overdrafts that form an integral part of the Group’s cash management.
2.17 Inventories
Inventories are stated at the lower of cost (determined on the weighted average basis) and net realisable value.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the
estimated costs necessary to make the sale.
2.18 Financial liabilities
Financial liabilities are classi ed according to the substance of the contractual arrangements entered into and the de nitions of a
nancial liability.
Financial liabilities, within the scope of MFRS 139, are recognised in the statement of nancial position when, and only when, the
Group and the Company become a party to the contractual provisions of the nancial instrument. Financial liabilities are classi ed
as either nancial liabilities at fair value through pro t or loss or other nancial liabilities.
(a)
Financial liabilities at fair value through pro t or loss
Financial liabilities at fair value through pro t or loss include nancial liabilities held for trading and nancial liabilities
designated upon initial recognition at fair value through pro t or loss.
Financial liabilities held for trading include derivatives entered into by the Group and the Company that do not meet the hedge
accounting criteria. Derivative liabilities are initially measured at fair value and subsequently stated at fair value, with any
resultant gains or losses recognised in pro t or loss. Net gains or losses on derivatives include exchange differences.
The Group and the Company have not designated any nancial liabilities at fair value through pro t or loss.
(b)
Other nancial liabilities
The Group’s and the Company’s other nancial liabilities include trade payables, other payables and loans and borrowings.
Trade and other payables are recognised initially at fair value plus directly attributable transaction costs and subsequently
measured at amortised cost using the effective interest method.
Loans and borrowings are recognised initially at fair value, net of transaction costs incurred, and subsequently measured at
amortised cost using the effective interest method. Borrowings are classi ed as current liabilities unless the Group has an
unconditional right to defer settlement of the liability for at least 12 months after the reporting date.
For other nancial liabilities, gains and losses are recognised in pro t or loss when the liabilities are derecognised, and
through the amortisation process.
Notes to the
Financial Statements
For the financial year ended 31 December 2013
(continued)