Page 62 - Stellar IAR2015

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (CONTINUED)Judgement is primarily exercised by management in respect of:• assessing the classi cation of the preference shares that were issued in November 2015 between debt and equity (refer to note 13);• the classi cation of nancial assets and liabilities into their relevant categories and in determining their appropriate measurementand disclosure;• assessing the impact of the proximity of the acquisition of the investment in Torre Industries Ltd to the measurement date and theimpact of the acquisition of the marketable, non-controlling stake (transaction volume) on the fair value of the investment; and• assessing the decrease in the volume or level of activity for the Mine Restoration Investments Ltd asset and the evaluation of theimpact thereof on the assessment whether quoted market prices provided by third parties are developed using current information that re ects orderly transactions.Estimation uncertainty arises in respect of the:• fair valuation of nancial instruments including portfolio investments held by the Group (refer to note 3), most notably the fairvaluation of the listed investments Torre Industries Ltd and Mine Restoration Investments Ltd by using inputs other that quotedmarket prices; and• recoverability of loan advances (refer to notes 4, 5, 7 and 9).2. NEW STANDARDS AND INTERPRETATIONS2.1. Standards and interpretations e ective and adopted in the current year2.1.1. IFRS 10 Consolidated Financial Statements - Investment Entity exemption (Refer to accounting policy 1.1)2.1.2. Amendments and annual improvements:• IFRS 7 Financial Instruments: Disclosures – O setting Financial Assets and Financial Liabilities• IAS 34 Interim Financial Reporting – Annual improvements• IFRS 10 Consolidated Financial Statements – Consolidation exemption parent entities which are subsidiaries of investmententities applying IFRS 10.31• IFRS 10 Consolidated Financial Statements – Consolidation requirement only applies to subsidiaries who are not themselvesinvestment entities and whose main purpose is to provide services which relate to the investment entity’s investment activities.2.2. Standards, interpretations and amendments not yet e ectiveCertain new standards, amendments and interpretations to existing standards have been published but which are not yet e ective and have not yet been early adopted by the Group. The impact of these standards is still being evaluated by the Group. These new standards and their e ective dates for the Group’s annual accounting periods are listed below:• IFRS 9 Financial Instruments – New requirements for classifying and measuring nancial assets and liabilities (e ective for periodsbeginning on or after 1 January 2018)The new standards, amendments and revisions and their e ective dates mentioned below are not expected to have a material impact on the Group’s results or nancial position:• IFRS 11 Joint Arrangements – Accounting for Acquisitions of Interests in Joint Operations (e ective for periods beginning on or after1 January 2018);• IFRS 15 Revenue from Contracts with Customers – A single, principles based ve-step model to be applied to all contracts withcustomers (e ective for periods beginning on or after 1 January 2018);• IFRS 16 Leases – Lessees required to account for leases ‘on-balance sheet’ by recognising a ‘right-of-use’ asset and a lease liability(e ective for periods beginning on or after 1 January 2019);• IAS 27 Separate Financial Statements – Equity Method in Separate Financial Statements (e ective for periods beginning on or after1 January 2016);• Amendments to IAS 16 and IAS 38 – Clari cation of Acceptable Methods of Depreciation and Amortization (e ective for periodsbeginning on or after 1 January 2018); and• Various improvements to IFRS.58 | STELLAR CAPITAL PARTNERS