287 INTEGRATED ANNUAL REPORT 2024 Key Messages Financial Statements Other Information NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2024 Overview of Wasco Berhad Value Creation Commitment to Governance Sustainability Journey 42 FINANCIAL INSTRUMENTS BY CATEGORY (CONTINUED) (a) Financial assets (continued) Impairment of financial assets Impairment of financial assets are as disclosed in Note 43. De-recognition Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group and the Company have transferred substantially all the risks and rewards of ownership. (b) Financial liabilities Classification Financial liabilities are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability. (i) Financial liabilities at fair value through profit or loss Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities held for trading include derivatives entered into by the Group and the Company that do not meet the hedge accounting criteria. Liabilities in this category are classified within current liabilities if they are either held for trading or are expected to be settled within 12 months after the reporting date. Otherwise, they are classified as non-current. (ii) Other financial liabilities The Group’s and the Company’s other financial liabilities include trade payables, other payables, intercompany payables, dividend payable and loans and borrowings. Loans and borrowings are classified as current liabilities unless the Group and the Company have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Recognition and de-recognition A financial liability is recognised when, and only when, the Group or the Company becomes a party to the contractual provisions of the financial instrument. A financial liability is derecognised when the obligation under the liability is extinguished. When 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 profit or loss.
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