Amal Ltd 2017-18

65 Note 1 Significant Accounting Policies (continued) at FVPL, transaction costs that are attributable to the acquisition of the financial asset. Transaction costs of financial asset carried at FVPL are expensed in the Statement of Profit and Loss. Subsequent measurement: After initial recognition, financial asset is measured at: i) fair value (either through FVOCI or through FVPL) or, ii) amortised cost Debt instruments: Subsequent measurement of debt instruments depends on the business model of the Company for managing the asset and the cash flow characteristics of the asset. There are 3 measurement categories into which the Company classifies its debt instruments: Measured at amortised cost: Financial assets that are held within a business model whose objective is to hold financial assets in order to collect contractual cash flows that are solely payments of principal and interest, are subsequently measured at amortised cost using the EIR method less impairment, if any, the amortisation of EIR and loss arising from impairment, if any, is recognised in the Statement of Profit and Loss. Measured at fair value through Other Comprehensive Income (OCI): Fiancial assets that are held within a business model whose objective is achieved by both, selling financial assets and collecting contractual cash flows that are solely payments of principal and interest, are subsequently measured at FVOCI. Fair value movements are recognized in the OCI. Interest income measured using the EIR method and impairment losses, if any are recognised in the Statement of Profit and Loss. On de-recognition, cumulative gain | (loss) previously recognised in OCI is reclassified from the equity to other income in the Statement of Profit and Loss. Measured at fair value through profit or loss (FVPL): A financial asset not classified as either amortised cost or FVOCI , is classified as FVPL. Such financial assets are measured at fair value with all changes in fair value, including interest income and dividend income, if any, recognised as other income in the Statement of Profit and Loss. Equity instruments : The Company subsequentlymeasures all investments in equity instruments other than subsidiary companies, associate company and joint venture company at fair value. The Management of the Company has elected to present fair value gains and losses on such equity investments through FVPL, and there is no subsequent reclassification of these fair value gains and losses to OCI. Dividends from such investments continue to be recognised in profit or loss as other income when the right to receive payment is established. Changes in the fair value of financial assets at FVPL are recognised in the Statement of Profit and Loss. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value. Impairment of financial assets: The Company assesses on a forward looking basis the expected credit losses associated with its financial assets carried at amortised cost and FVOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade and lease receivable only, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognised from initial recognition of such receivables. De-recognition: A financial asset is de-recognised only when the Company has transferred the rights to receive cash flows from the financial asset or, the asset expires or retains the contractual rights to receive the cash flows of Notes to the Financial Statements