Maxis Berhad
Annual Report 2015
page
94
Notes to the Financial Statements
31 December 2015
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(f) Financial instruments (continued)
(i)
Classification and measurement (continued)
Financial liabilities
The Group and the Company classify their financial liabilities in the following categories: at fair value through profit or loss, other
financial liabilities and financial guarantee contracts. Management determines the classification of financial liabilities at initial
recognition.
The Group and the Company do not hold any financial liabilities carried at fair value through profit or loss (except for derivative
financial instruments) and financial guarantee contracts. See accounting policy Note 3(h) on derivative financial instruments and
hedging activities.
Other financial liabilities are non-derivative financial liabilities. Other financial liabilities are initially recognised at fair value plus
transaction costs that are directly attributable to the acquisition of the financial liability and subsequently carried at amortised cost
using the effective interest method. Changes in the carrying value of these liabilities are recognised in the statement of profit or loss.
The Group’s and the Company’s other financial liabilities comprise payables (including inter-companies and related parties balances)
and borrowings in the statement of financial position. Financial liabilities are classified as current liabilities; except for maturities
greater than 12 months after the reporting date, in which case they are classified as non-current liabilities.
(ii)
Recognition of financial assets and financial liabilities
Financial assets and financial liabilities are recognised when the Group and the Company become party to the contractual provisions
of the instrument.
(iii) Derecognition of financial assets and financial liabilities
Financial assets are derecognised when the risks and rewards relating to the financial assets have expired or have been fully
transferred or have been partially transferred with no control over the same.
Financial liabilities are derecognised when the liability is either discharged, cancelled, expired or has been restructured with
substantially different terms.
(iv) Offsetting of financial assets and financial liabilities
Financial assets and financial liabilities are offset and the net amount reported in the statement of financial position when there is a
legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and
settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in
the normal course of business and in the event of default, insolvency or bankruptcy.
