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Hyprop Investments Limited
Group annual financial statements 2016
1.
Accounting policies and presentation of financial statements
continued
1.10 Investment property
continued
An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future
economic benefits are expected from the property. Any gain or loss arising on derecognition of the property is included in profit or loss in
the period in which the property is derecognised. The gain or loss is calculated as the difference between the net disposal proceeds and the
carrying amount of the asset.
1.11
Non-current assets held-for-sale
Non-current assets, or disposal groups comprising assets and liabilities, that are expected to be recovered primarily through sale rather
than through continuing use, are classified as held-for-sale. This condition is regarded as met only when the sale is highly probable and the
non-current asset or disposal group is available for sale in its present condition subject only to terms that are usual and customary for sales
of such assets. For the sale to be highly probable, the appropriate level of management must be committed to a plan to sell the asset or
disposal group.
Investment property classified as held-for-sale is measured in accordance with IAS 40
Investment Property
at fair value with gains and losses
on subsequent measurement being recognised in profit or loss. Disposal groups and non-current assets held-for-sale are presented separately
from other assets and liabilities on the statement of financial position.
1.12 Financial instruments
Financial instruments are contracts that give rise to a financial asset of one entity and a financial liability or equity instrument of another
entity.
Financial assets and financial liabilities are recognised on the statement of financial position when the group becomes party to the contractual
provisions of the instrument. The group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a
financial liability or an equity instrument in accordance with the substance of the contractual arrangement. Financial assets and financial
liabilities are initially measured at fair value. All transaction costs relating to financial instruments measured at fair value through profit or loss
are immediately expensed.
Derecognition of financial instruments
The group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to
receive the contractual cash flows on the financial asset in a transaction in which substantially all the risks and rewards of ownership of the
financial asset are transferred. Any interest in transferred financial assets that is created or retained by the group is recognised as a separate
asset or liability.
The group derecognises a financial liability when its contractual obligations are discharged, cancelled or expire.
Offset
Financial assets and financial liabilities are offset and the net amount reported in the statement of financial position, when the group has an
enforceable right to set off the recognised amounts, and intends to settle on a net basis or to realise the asset and settle the liability
simultaneously.
Subsequent measurement
Subsequent to initial recognition, these instruments are measured as follows:
Financial assets
1.12.1
Cash and cash equivalents
Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to
an insignificant risk of changes in value. Cash and cash equivalents are measured at amortised cost. Interest earned on cash invested
with financial institutions is recognised on an accrual basis using the effective interest method.