146
GHL Systems Berhad
(293040-D)
NOTES TO THE FINANCIAL STATEMENTS
31 December 2014 (continued)
35. FINANCIAL INSTRUMENTS (continued)
(d) Fair value hierarchy
Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets
for identical assets or liabilities.
Level 2 fair value measurements are those derived from inputs other than quoted prices included within
Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived
from prices).
Fair values of non-derivative financial liabilities, which are determined for disclosure purposes, are
calculated based on the present value of future principal and interest cash flows, discounted at the
market rate of interest at the end of the reporting period. In respect of the borrowings, the market rate
of interest is determined by reference to similar borrowing arrangements.
Level 3 fair value measurements are those derived from inputs for the asset or liability that are not
based on observable market data (unobservable inputs).
The valuation techniques and significant unobservable inputs used in determining the fair value
measurement of Level 3 financial instruments as well as the relationship between key unobservable
inputs and fair value, is detailed in the table below.
Financial instruments
Valuation technique
used
Significant
unobservable inputs
Inter-relationship
between key
unobservable inputs
and fair value
Financial asset
Trade and other
receivables
Discounted cash flows
method
Discount rate (Malaysia
Base Lending Rate less
1%)
The higher the discount
rate, the lower the
fair value of the trade
and other receivables
would be.
The following tables set out the financial instruments carried at fair value and those not carried at fair
value for which fair value is disclosed, together with their fair values and carrying amounts shown in the
statements of financial position.
Fair values of financial instruments
carried at fair value
Fair values of financial instruments
not carried at fair value
Total
Carrying
Level 1 Level 2 Level 3
Total
Level 1 Level 2 Level 3 Total
fair value amount
RM RM RM RM RM RM RM RM RM RM
2014
Group
Financial assets
Financial assets at
available-
for-sale
- Available-for-sale
investments
- 8,000,000
- 8,000,000
-
-
-
- 8,000,000 8,000,000
- 8,000,000
- 8,000,000
-
-
-
- 8,000,000 8,000,000
