Page 116 - DUT Annual Report 2020

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DURBAN UNIVERSITY OF TECHNOLOGY ANNUAL REPORT 2020
DURBAN UNIVERSITY OF TECHNOLOGY
BAN UNIVERSITY OF TECHNOLOGY
NOTES TO THE CONSOLIDATED ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2020
1. ACCOUNTING POLICIES (continued) 1.12 Financial instruments (continued)
1.12.1 Fair value measurement (continued)
For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the University determines whether transfers have occurred between levels in the hierarchy by re-assessing 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.
Fair-value related disclosures for financial instruments are disclosed are summarised in the following notes 22.
1.12.2 Financial assets
Classification categories
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the University’s business model for managing them.
The University classifies financial assets into the following categories:
Financial Instrument
Investments
Receivables and prepayments Cash and cash equivalents
Subsequent measurement
Classification under IFRS 9
Fair value through OCI Amortised cost Amortised cost
Financial assets are subsequently measured at either amortised cost or fair value through OCI, depending on the classification of the financial assets.
1.12.2.1 Financial assets at amortised cost
Classification
The University classifies financial assets at amortised cost if both the following conditions are met:
 The financial asset is held within a business model with the objective to hold financial assets in order
to collect contractual cash flows and;
 The contractual terms of the financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.
Initial measurement
The amortised cost of a financial asset is the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount, adjusted for any loss allowance. The gross carrying amount of a financial asset is the amortised cost of a financial asset before adjusting for any loss allowance.
Subsequent measurement
Financial assets at amortised cost are subsequently measured using the effective interest (EIR) method and are subject to impairment.
Gains and losses are recognised in net surplus or deficit when the asset is derecognised, modified or impaired.