152 / 232
Kumpulan Fima Berhad
(11817-V)
150
Notes to the
financial statements
31 march 2017
2.
Significant accounting policies (cont’d.)
2.3 Summary of significant accounting policies (cont’d.)
(v)
Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The fair value measurement is based on the presumption
that the transaction to sell the asset or transfer the liability takes place either:
-
In the principal market for the asset or liability, or
-
In the absence of a principal market, in the most advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible to the Company.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when
pricing the asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group and the Company use valuation techniques that are appropriate in the circumstances and for which
sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising
the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised
within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair
value measurement as a whole:
-
Level 1 — Quoted (unadjusted) prices in active markets for identical assets or liabilities
-
Level 2 — Other techniques for which all inputs that have a significant effect on the recorded fair value are
observable, either directly or indirectly
-
Level 3 — Techniques that use inputs that have a significant effect on the recorded fair value that are not
based on observable market data
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Group and
the Company determine 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.