Group Overview Operation and Financial Review Financials Other Information Sustainability and Governance 147 Annual Report 2025 Notes to the financial statements For the financial year ended 31 December 2025 34. Fair value of assets and liabilities (cont’d) (a) Fair value hierarchy (cont’d) For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group determines whether transfers have occurred between Levels in the hierarchy by reassessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. (b) Valuation policy The Group’s financial reporting team in charge of valuation (“Valuation Team”) determines the policies and procedures for recurring fair value measurement, such as biological assets and recoverable amounts of CGUs (for goodwill impairment test purpose). External valuers are involved for valuation of significant assets. Involvement of external valuers is decided annually by the Valuation Team after discussion with and approval by the Group’s executive directors. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained. The Valuation Team decides, after discussions with the Group’s external valuers, which valuation techniques and inputs to use. For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above. (c) Financial instruments carried at fair value or amortised cost Plasma receivables and long-term loans to employees are carried at amortised cost using the effective interest method and the discount rates used are the current market incremental lending rate for similar types of lending. The effective yearly interest rates were ranging from 5.67% to 7.92% (2024: 7.00% to 8.24%) for the year ended 31 December 2025. The carrying amounts of cash and cash equivalents, current trade and other receivables, current trade and other payables and accruals, short-term bank loans and borrowings, and lease liabilities are the approximations of their fair values because they are mostly short-term in nature. The carrying amounts of long-term loans and borrowings and due to related parties with floating interest rates are the approximations of their fair values as they are re-priced frequently.
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