141 Note 1 Significant accounting policies (continued) m) Inventories Inventories are stated at cost or net realisable value, whichever is lower. Cost is determined on periodic moving weighted average basis. Net realisable value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary to effect the sale. Cost comprises all costs of purchase, costs of conversion and other costs incurred in bringing the inventory to the present location and condition. Due allowances are made for slow | non-moving, defective and obsolete inventories based on estimates made by the Group. Items such as spare parts, stand-by equipment and servicing equipment that are not plant and machinery get classified as inventory. n) Investments and other financial assets Classification and measurement The Group classifies its financial assets in the following measurement categories: i) Those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss) ii) Those measured at amortised cost The classification depends on businessmodel of the Group for managing financial assets and the contractual terms of the cash flows. For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income (OCI). For investments in debt instruments, this will depend on the business model in which the investment is held. For investments in equity instruments, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through OCI. Debt instruments Initial recognition and measurement: Financial asset is recognised when the Group becomes a party to the contractual provisions of the instrument. Financial asset is recognised initially at fair value plus, in the case of financial asset not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Transaction costs of financial asset carried at fair value through profit or loss are expensed in the Consolidated Statement of Profit and Loss. Subsequent measurement: Subsequent measurement of debt instruments depends on the business model of the Group for managing the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Group classifies its debt instruments:
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