Page 29 - Agib Bank Limited Annual Report 2021

Liabilities arising from a Single Transaction estimated future cash payments and receipts
(Amendments to IAS 12) through the expected life of the financial asset or
liability (or, where appropriate, a shorter period)
On 7 May 2021, amendments were issued for to the carrying amount of the financial asset or
th
IAS 12. liability.

The main change in Deferred Tax related to The calculation of the effective interest rate
Assets and Liabilities arising from a Single includes all fees paid or received transaction
Transaction (Amendments to IAS 12) is an costs, and discounts or premiums that are an
exemption from the initial recognition integral part of the effective interest rate.
exemption provided in IAS 12.15(b) and IAS Transaction costs are incremental costs that are
12.24. Accordingly, the initial recognition directly attributable to the acquisition, issue or
exemption does not apply to transactions in disposal of a financial asset or liability.

which equal amounts of deductible and taxable Investment income and expense presented in the
temporary differences arise on initial income statement include:
recognition. This is also explained in the newly
inserted paragraph IAS 12.22A.
Profit (markup) on financial assets and liabilities
The amendments are effective for annual at amortised cost on an effective interest rate
reporting periods beginning on or after 1 basis.
January 2023. Early adoption is permitted.
Profit (markup) on Held to maturity investments
(Sukuk al Salam) on an effective interest basis.
4 Significant Accounting Policies
Investment income and expense on all trading
The accounting policies set out below have been assets and liabilities are considered to be
applied consistently to all periods presented in incidental to the bank’s trading operations and
these financial statements are presented together with all other changes in
the fair value of trading assets and liabilities in net
trading income.
4.1 Foreign currency activities
4.3 Fees and commission
Transactions in currencies other than Dalasi are
recorded at the rates of exchange prevailing on Fees and commission income and expenses that
the dates of the transactions. At each balance are integral to the effective interest rate on a
sheet date, monetary assets and liabilities that financial asset or liability are included in the
are denominated in foreign currencies are measurement of the effective interest rate.
retranslated at the rates prevailing on the balance
sheet date. Non-monetary assets and liabilities Fees and commissions that do not form part of
carried at fair value that are denominated in the effective interest rate are recognised as
foreign currencies are translated at the rates expense and income in the income statement on
prevailing at the date when the fair value was an accrual basis.
determined. Gains and losses arising on
retranslation are included in net profit or loss for Other fees and commission expense relates
the period, except for exchange differences mainly to transaction and service fees, which are
arising on non-monetary assets and liabilities expensed as the services are received.
where the changes in fair value are recognized
directly in equity. 4.4 Lease

The Bank has applied IFRS 16 using the
4.2 Revenue from investments
cumulative catch-up approach.The details of
Revenue is generally recognised when future accounting policies under both IAS 17 and IFRS
economic benefits of the underlying assets will
flow to the Bank and it can be reliably measured. 16 are presented separately below.
It is income derived from use of an entity’s assets
and hence the revenue is mostly dependent on Annual Report and IFRS Financial Statements
the underlying agreement. Investment income The Bank as a lessee
and expense is accrued on a time basis, by
reference to the principal outstanding and the The Bank assesses whether a contract is or
effective interest rate applicable. The effective contains a lease, at inception of the contract. The
interest rate is the rate that exactly discounts the Bank recognises a right-of-use asset and a

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