FRASERS HOSPITALITY TRUST ANNUAL REPORT 2015
151
NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL PERIOD FROM 20 JUNE 2014 (DATE OF CONSTITUTION) TO 30 SEPTEMBER 2015
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
2.7 Financial assets
Financial assets within the scope of FRS 39 are classified as either financial assets at fair value through profit or
loss, loans and receivables, held-to-maturity investments, or available-for-sale financial assets, as appropriate.
Financial assets are recognised when, and only when, the Stapled Group becomes a party to the contractual
provisions of the financial instrument.
When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets
not at fair value through profit and loss, directly attributable transaction costs. The Stapled Group determines
the classification of its financial assets at initial recognition and, where allowed and appropriate, re-evaluates
this designation at each financial year end.
Non-derivative financial assets with fixed or determinable payment that are not quoted in an active market are
classified as loans and receivables. Such assets are initially recognised at fair value, plus directly attributable
costs, and subsequently carried at amortised cost using the effective interest method. Gains and losses are
recognised in the Statements of Total Return when the loans and receivables are derecognised or impaired, and
through the amortisation process.
Available-for-sale financial assets are those that are not classified in any of the other categories. After initial
recognition, available-for-sale financial assets are measured at fair value, with any resultant gain or loss
recognised in other comprehensive income, except that impairment losses, foreign exchange gains and
losses on monetary instruments and interest calculated using the effective interest method are recognised
in Statements of Total Return. The cumulative gain or loss previously recognised in other comprehensive
income is reclassified from the Stapled Securityholders’ Funds to Statements of Total Return as a reclassification
adjustment when the financial asset is derecognised.
2.8 Receivables
Trade and other receivables, including amounts due from related companies and loans to related companies,
are classified and accounted for as loans and receivables under FRS 39. The accounting policy is stated in Note
2.7.
An allowance is made for uncollectible amounts when there is objective evidence that the Stapled Group will
not be able to collect the debt. Bad debts are written off when identified. Further details of accounting policy
for impairment of financial assets are stated in Note 2.15.
2.9 Other assets
Other assets comprise operating supplies such as linen, silverware, glassware and chinaware. They are stated at
cost less accumulated amortisation.
2.10 Cash and cash equivalents
Cash on hand and in banks and fixed deposits which are held to maturity are classified and accounted for as
loans and receivables under FRS 39. The accounting policy is stated in Note 2.7.
For the purpose of the Statements of Cash Flows, cash and cash equivalents consist of cash on hand and deposits
in banks.
2.11 Financial liabilities
Financial liabilities within the scope of FRS 39 are recognised when, and only when, the Stapled Group becomes
a party to the contractual provisions of the financial instrument.
Financial liabilities are recognised initially at fair value plus directly attributable transaction costs.
Subsequent to initial recognition, financial liabilities are measured at amortised cost using the effective interest
method.
Gains and losses are recognised in the Statements of Total Return when the liabilities are derecognised, and
through the amortisation process.
