Page 33 - 2021 ANNUAL REPORT draft

are measured at fair value are translated using the exchange rates at the date when the fair value was
determined.
Foreign exchange gains and losses resulting from the settlement of foreign currency transactions and from
the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign
currencies are recognized in the Income statement, except when deferred in equity as gains or losses from
qualifying cash flow hedging instruments or qualifying net investment hedging instruments.
All foreign exchange gains and losses recognized in the Income statement are presented net in the Income
statement within the corresponding item. Foreign exchange gains and losses on other comprehensive
income items are presented in other comprehensive income within the corresponding item.
In the case of changes in the fair value of monetary assets denominated in foreign currency, a distinction
is made between translation differences resulting from changes in amortized cost of the security and other
changes in the carrying amount of the security. Translation differences related to changes in the amortized
cost are recognized in profit or loss, and other changes in the carrying amount, except impairment, are
recognized in equity.

3.4 Cash and cash equivalents

Cash and cash equivalents include notes and coins on hand, unrestricted balances held with central bank
of The Gambia, balances held with other banks and Money market placements. Cash and cash
equivalents are carried at amortised cost in the Statement of financial position.

3.5 Financial instruments

Classification and Measurement

IFRS 9 requires financial assets to be classified into one of three measurement categories: fair value
through profit or loss, fair value through other comprehensive income and amortised cost.

Financial assets will be measured at amortised cost if they are held within a business model with the
objective of which is to hold financial assets in order to collect contractual cash flows, and their contractual
cash flows represent solely payments of principal and interest.
Financial assets will be measured at fair value through other comprehensive income if they are held
within a business model the objective of which is achieved by both collecting contractual cash flows and
selling financial assets and their contractual cash flows represent solely payments of principal and
interest.

Financial assets not meeting either of these two business models; and all equity instruments (unless
designated at inception to fair value through other comprehensive income); and all derivatives are
measured at fair value through profit or loss.

An entity may, at initial recognition, designate a financial asset as measured at fair value through profit or
loss if doing so eliminates or significantly reduces an accounting mismatch.

The Bank has undertaken an assessment to determine the potential impact of changes in classification and
measurement of financial assets. The adoption of IFRS 9 did not result in significant changes to existing
asset measurement bases.

Impairment Methodology

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Guaranty Trust Bank (Gambia) Limited Financial Statements December 2021