2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2.35 Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The fair value measurement is based on the presumption that
the transaction to sell the asset or transfer the liability takes place either:
(i) In the principal market for the asset or liability, or
(ii) In the absence of a principal market, in the most advantageous market for the asset or liability
The principal or the most advantageous market must be accessible to by the Group.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when
pricing the asset or liability, assuming that market participant act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group uses valuation techniques that appropriate in circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within
the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value
measurement as a whole:
(i) Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
(ii) Level 2 – Valuation techniques for the lowest level input that is significant to the fair value measurement is
directly or indirectly observable.
(iii) Level 3 – Valuation techniques for which the lowest level input that is significant to the fair value measurement
is unobservable.
For the purposes of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of
the nature, characteristics and risks of the assets or liabilities and the level of the fair value hierarchy as explained
above.
2.36 Government grants
Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant
will be received and the Group will comply with all attached conditions.
Government grants relating to costs are recognised in profit or loss over the periods to match the related costs for
which the grants are intended to compensate.
Government grants relating to the purchase of assets are presented as a reduction of the carrying amount of the
related assets. The government grant is recognised in profit or loss over the life of the related property, plant and
equipment as a reduced depreciation expense.
260
NOTES TO THE
FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2015 (CONTINUED)
