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GB Auto and its subsidiaries (S.A.E.)
Notes to the consolidated financial statements For the financial Year ended December 31, 2014
(In the notes all amounts are shown in Thousand Egyptian Pounds unless otherwise stated)
L. Financial assets
(i) Classification
The Group classifies its financial assets based on the purpose for which the financial assets were acquired at initial recogni-
tion as following.
• Financial assets at fair value through profit or loss (Investments in securities for trading).
• Investments held to maturity.
• Loans and receivables.
• Available-for-sale financial assets.
(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) Investments Held to maturity
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed ma-
turity that the company has the intention and ability to hold it to maturity other than:
1. Those that the company upon initial recognition recognize them as at fair value through profit or loss
2. Those that the company recognize them as available-for-sale; and
3. Those that meet the definition of loans and receivables.
(c) Loans and receivables
Loans and receivables are non-derivative financial assets with specified or determinable value that are not quoted
in an active market. They are included in current assets, if their maturities are less than 12 months after the balance
sheet date. If not they are classified as non-current assets.
(d) Available-for-sale financial assets
Available-for-sale financial assets are non-derivatives financial assets that are either classified under this category at
acquisition date or not classified in any of the other categories. They are included in non-current assets unless man-
agement intends to dispose it within 12 months of the balance sheet date.
(ii) Reclassification
The Group may choose to reclassify the financial assets other than non-derivative that are not going to be available-for-sale
or repurchased it in the near future out of financial instruments at fair value through profit or loss if this instrument has not
been initially recognised by the company as financial assets at fair value through profit or loss.
Financial assets other than loans and receivables are permitted to be reclassified out of the financial assets at fair value
through profit or loss category only in rare circumstances arising from a single event that is unusual and highly unlikely to
recur in the near future. In addition, the Group may choose to reclassify financial assets that would meet the definition of
loans and receivables out of the financial assets at fair value through profit or loss or the available-for-sale categories if the
Group has the intention and ability to hold these financial assets for the foreseeable future or maturity at the date of reclas-
sification.
Reclassifications are made at fair value as of the reclassification date. Fair value becomes the new cost or amortised cost as
applicable, and no reversals of fair value gains or losses recorded before reclassification date are subsequently made. Effec-
tive interest rates for financial assets reclassified to loans and receivables and held-to-maturity categories are determined at
the reclassification date. Further increases in estimates of cash flows adjust effective interest rates prospectively.
(iii) Measurement and subsequent measurement
Regular purchases and sales of financial assets are recognised on the trade-date – the date on which the Group
commits to purchase or sell the asset.
Ghabbour Auto | 2014 ANNUAL REPORT
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