Page 51 - UKZN Foundation AR 2024

UNIVERSITY OF KWAZULU-NATAL FOUNDATION TRUST Trust Deed number: IT 589/2003
NOTES TO THE FINANCIAL STATEMENTS (continued)
for the year ended 31December 2024
14. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Continued)
Fair value estimation
Market values have been to determine the fair value of financial assets at fair value through profit or loss and is based on quoted market prices at the statement of financial position date which have been summarized in the table below:
Financial assets at fair value through profit or loss: 31 December 2024
Equity Securities:
Investec Opportunity Fund
27four Balanced Prescient Fund
Financial assets at fair value through profit or loss : 31 December 2023
Investec Opportunity Fund
27four Balanced Prescient Fund
There were no transfers between levels 1 and 2 for recurring fair value measurements during the year.
The Trust’s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and equity securities) is based on quoted market prices at the end of the reporting period. The quoted market price used for financial assets held by the trust is the current bid price. These instruments are included in level 1.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity- specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities.
Specific valuation techniques used to value financial instruments include:
∙ the use of quoted market prices or dealer quotes for similar instruments
∙ for interest rate swaps - the present value of the estimated future cash flows based on observable yield curves balance sheet date
∙ for foreign currency options - option pricing models (e.g. Black-Scholes model), and
∙ for other financial instruments - discounted cash flow analysis.
Level 1 R
168 928 982 148 716 118
Level 1 R
143 261 459 113 694 228
UKZN FOUNDATION ANNUAL REPORT 2024 49