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Notes to the Financial Statements
For the fnancial year ended 31 December 2012
3. Summary of significant accounting policies (cont’d)
3.13 Associates (cont’d)
The proft or loss refects the share of the results of operations of the associates. Where there has been a change recognised in
other comprehensive income by the associates, the Group recognizes its share of such changes in other comprehensive income.
Unrealised gains and losses resulting from transactions between the Group and the associate are eliminated to the extent of the
interest in the associate.
The Group’s share of the proft or loss of its associates is the proft attributable to equity holders of the associate and, therefore is
the proft or loss after tax and non-controlling interest in the subsidiaries of associates.
When the Group’s share of losses of an associate equals or exceeds its interest in the associate, the Group does not recognise
further losses, unless it has incurred obligations or made payments on behalf of the associate.
After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss on
the Group’s investment in its associate. The Group determines at the end of each reporting period whether there is any objective
evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as
the difference between the recoverable amount of the associate and its carrying value and recognises the amount in investment
in proft or loss.
The fnancial statements of the associate are prepared for the same reporting period as the Company. Where necessary, adjustments
are made to bring the accounting policies in line with those of the Group.
Upon loss of signifcant infuence over the associate, the Group measures and recognises any retained investment at its fair value.
Any difference between the carrying amount of the associate upon loss of signifcant infuence and the fair value of the aggregate
of the retained investment and proceeds from disposal is recognised in proft or loss.
3.14 Financial assets
Initial recognition and measurement
Financial assets are recognised when, and only when, the Group becomes a party to the contractual provisions of the fnancial
instrument. The Group determines the classifcation of its fnancial assets at initial recognition.
When fnancial assets are recognised initially, they are measured at fair value, plus, in the case of fnancial assets not at fair value
through proft or loss, directly attributable transaction costs.
Subsequent measurement
The subsequent measurement of fnancial assets depends on their classifcation as follows:
(a) Financial assets at fair value through proft or loss
Financial assets at fair value through proft or loss include fnancial assets held for trading and fnancial assets designated
upon initial recognition at fair value through proft or loss. Financial assets are classifed as held for trading if they are acquired
for the purpose of selling or repurchasing in the near term. This category includes derivative fnancial instruments entered
into by the Group that are not designated as hedging instruments in hedge relationships as defned by FRS 39. Derivatives,
including separated embedded derivatives are also classifed as held for trading unless they are designated as effective
hedging instruments.
The Group has not designated any fnancial assets upon initial recognition at fair value through proft or loss.
Indofood Agri Resources Ltd. • Annual Report 2012 77