Page 32 - Agib Bank Limited Annual Report 2021
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4.9 Cash and cash equivalents including it in the initial carrying amount of the
asset or liability).
Cash and cash equivalents include notes and
coins on hand, unrestricted balances held with After initial recognition, the deferred gain or
central bank and highly liquid financial assets loss will be released to profit or loss on a
with original maturities of less than three rational basis, only to the extent that it arises
months, which are subject to insignificant risk from a change in a factor (including time) that
of changes in their fair value, and are used by market participants would take into account
the Bank in the management of its short-term when pricing the asset or liability.
commitments.
4.12 Financial assets
4.10 Account receivables 4.12.1 Classification of financial assets
Account receivables are non-derivative All financial assets are recognised and
financial assets with fixed or determinable derecognised on a trade date where the
payments that are not quoted in an active purchase or sale of a financial asset is under a
market and that the Bank does not intend to sell contract whose terms require delivery of the
immediately or in the near term. financial asset within the timeframe established
by the market concerned, and are initially
measured at fair value, plus transaction costs,
4.11 Financial instruments
except for those financial assets classified as
at FVTPL. Transaction costs directly
4.11.1 Initial Recognition attributable to the acquisition of financial assets
classified as at FVTPL are recognised
immediately in profit or loss.
Financial assets and financial liabilities are
recognised in the Bank’s balance sheet when All recognised financial assets that are within
the Bank becomes a party to the contractual the scope of IFRS 9 are required to be
provisions of the instrument. subsequently measured at amortised cost or
fair value on the basis of the entity’s business
model for managing the financial assets and
4.11.2 Initial Measurement
the contractual cash flow characteristics of the
Financial assets and financial liabilities are financial assets.
initially measured at fair value. Transaction Specifically:
costs that are directly attributable to the
acquisition or issue of financial assets and • assets that are held within a business model
financial liabilities (other than financial assets whose objective is to collect the contractual
and financial liabilities at FVTPL) are added to cash flows, and that have contractual cash
or deducted from the fair value of the financial flows that are solely payments of principal and
assets or financial liabilities, as appropriate, on mark-up on the principal amount outstanding
initial recognition. are subsequently measured at amortised cost;
Transaction costs directly attributable to the assets that are held within a business model
acquisition of financial assets or financial whose objective is both to collect the
liabilities at FVTPL are recognised immediately contractual cash flows and to sell the debt
in profit or loss. If the transaction price differs instruments, and that have contractual cash
from fair value at initial recognition, the Bank flows that are SPPI, are subsequently
will account for such difference as follows: measured at FVTOCI;
• if fair value is evidenced by a quoted price in all other assets (e.g. debt instruments
an active market for an identical asset or managed on a fair value basis, or held for sale)
liability or based on a valuation technique that and equity investments are subsequently
uses only data from observable markets, then measured at FVTPL.
the difference is recognised in profit or loss on Annual Report and IFRS Financial Statements
initial recognition (i.e. day 1 profit or loss); 4.12.2 Amortised cost and effective
profit rate method
• in all other cases, the fair value will be
adjusted to bring it in line with the transaction The effective rate method is the method of
price (i.e. day 1 profit or loss will be deferred by calculating the amortised cost of those financial
Agib Bank Annual Report 2021 www.agib.gm 32
