Al-`Aqar Healthcare REIT Annual Report 2019

06 FINANCIAL STATEMENT 124 Equity instruments The Group and the Fund subsequently measure all equity investments at fair value. Where the Group’s and the Fund’s management have elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such investments continue to be recognised in profit or loss as other income when the Group’s and the Fund’s right to receive payments is established. Changes in the fair value of financial assets at FVTPL are recognised in other income/ (losses) in profit or loss as applicable. Impairment losses (and reversal of impairment losses) on equity investments measured at FVTOCI are not reported separately from other changes in fair value. Impairment of financial assets The Group and the Fund assess on a forward-looking basis the expected credit loss (“ECL”) associated with its financial instruments carried at amortised cost and at FVTOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk. The Group and the Fund have three types of financial instruments that are subject to the ECL model: • Trade receivables • Other receivables • Amount due from a subsidiary While cash and cash equivalents are also subject to the impairment requirements of MFRS 9, the identified impairment loss was insignificant. ECL represent a probability-weighted estimate of the difference between the present value of contractual cash flows and the present value of cash flows the Group and the Fund expect to receive, over the remaining life of the financial instrument. The measurement of ECL reflects: • an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes; • the time value of money; and • reasonable and supportable information that is available without undue cost or effort at the end of the reporting period about past events, current conditions and forecasts of future economic conditions. General 3-stage approach for other receivables and amount due from a subsidiary At the end of each reporting period, the Group and the Fund measures ECL through a loss allowance at an amount equal to the 12-month ECL if credit risk on a financial instrument or a group of financial instruments has not increased significantly since initial recognition. For all other financial instruments, a loss allowance at an amount equal to lifetime ECL is required, when there has been a significant increase in credit risk since initial recognition. Notes To The Financial Statements For The Financial Year Ended 31 December 2019 (Continued) 3. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 3.5 Financial instruments (Continued)