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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)
1.13. De-recognition of financial assets and liabilities (continued)
1.13.1.1 Financial assets at amortised costs
On derecognition of a financial asset measured at amortised cost, the difference between the asset's carrying amount and the sum of the consideration received and receivable is recognised in net surplus or deficit.
1.13.1.2 Financial assets at FVOCI
On derecognition of a financial assets measured at FVOCI the financial instruments are treated in the following manner:
 For investment in a debt instruments classified at FVOCI, the cumulative gain or loss previously accumulated in the investment’s revaluation reserve is reclassified to net surplus or deficit.
 For investment in equity instruments, the cumulative gain or loss previously accumulated in the investments fair value reserve is not reclassified to net surplus or deficit, but is transferred to accumulated funds.
1.13.2 Financial liabilities
A financial liability is de-recognised when the obligation under the liability is discharged or cancelled or expires.
Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a de-recognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in surplus or deficit.
Financial assets and liabilities are offset and the net amount reported in the statement of financial position only when there is currently a legally enforceable right to set off the recognised amounts; and there is an intention either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
1.14 Provisions
Provisions are recognised when the University has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.
Where the University expects some or all a provision to be reimbursed, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in surplus and deficit net of any reimbursement. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
Provisions comprise the short-term portion of employee benefit obligation and vacation leave pay. Accumulated leave pay represents the leave staff are entitled to for unutilised leave prior to 2008.