Financial instruments

as at 31 August 2020

The table below sets out the Group's classification of each class of financial instrument at their fair values. The carrying amount of these financial instruments approximates their fair values, therefore no fair value disclosures are provided. The different fair value levels are described below.

Level 1 – inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;

Level 2 – inputs are inputs, other than quoted prices included within level 1, that are observable for the asset or liability, either directly or indirectly; and

Level 3 – inputs are inputs for the asset or liability that are not based on observable market data (unobservable inputs).

In estimating the fair value of an asset or liability, the Group uses market-observable data to the extent it is available. Where level 1 inputs are not available, the Group engages qualified third-party valuers to perform the valuation.

US$'000 Level   Unaudited 
Six months 
to 31 August 
2020 
  Unaudited 
Six months 
to 31 August 
2019 
  Audited 
Year ended 
29 February 
2020 
 
FINANCIAL ASSETS
Financial assets at amortised cost
Gross trade accounts receivable 1 105 720    1 170 853    1 140 012   
Less: Expected credit loss allowances (29 638)   (34 829)   (29 502)  
Bonds 8 157    13 158    13 118   
Loans granted to third parties and other long-term assets due 8 468    3 656    9 460   
Finance lease receivables 36 774    30 056    35 692   
Sundry receivables 43 926    53 933    56 688   
Cash and cash equivalents at financial institutions 406 685    295 140    347 189   
Financial assets at fair value through profit or loss
Derivative financial assets 2   584    –    –   
  1 580 676    1 531 967    1 572 657   
FINANCIAL LIABILITIES 
Financial liabilities at amortised cost 
Trade payables  (1 018 623)    (1 000 270)    (928 201)   
Other payables and financial liabilities  (208 585)    (166 164)    (198 236)   
Long-term interest-bearing liabilities*  (55 132)    (54 279)    (43 032)   
Lease liabilities*  (148 730)    (132 849)    (129 473)   
Short-term interest-bearing liabilities  (4 936)    (44 103)    (50 751)   
Bank overdrafts  (271 046)    (257 647)    (263 800)   
Financial liabilities at fair value through profit or loss 
Amounts owing to vendors     (2 437)    (2 921)    (5 490)   
Derivative financial liabilities     (7 514)    (307)    (724)   
(1 717 003)    (1 658 540)    (1 619 707)   
* Includes current portion of long-term liabilities.

There were no transfers between level 1 and level 2 during the period.

Amounts owing to vendors represent purchase considerations owing in respect of acquisitions. The purchase considerations are to be settled with the vendors in cash or shares on achievement of agreed performance criteria. The amounts owing are interest free.

Amounts owing to vendors are classified as financial liabilities designated at fair value through profit or loss. They are classified as level 3 financial instruments, whose fair value measurements are derived from inputs that are unobservable for the liabilities. Movements are presented in the statement of comprehensive income as acquisition-related fair value adjustments.


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