3)Derecognition of financial assets
The Corporation derecognizes a financial asset only when the contractual rights to the cash flows from the
asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of
the asset to another party.
On the full derecognition of a financial asset, the difference between the asset’s carrying amount and the sum
of the consideration received and receivable and the cumulative gain or loss that had been recognized in
other comprehensive income is recognized in profit or loss.
b.Financial liabilities
1)Subsequent measurement
Except in the following situations, all the financial liabilities are measured at amortized cost using the effective
interest method:
Financial liabilities are classified as at fair value through profit or loss when the financial liability is either held
for trading or designated as at fair value through profit or loss.
Financial liabilities at fair value through profit or loss are stated at fair value, with any gains or losses on
remeasurement recognized in profit or loss. The net gain or loss recognized in profit or loss incorporates any
interest or dividend paid on the financial liability. Fair value is determined in the manner described in Note
31.
2)Derecognition of financial liabilities
The difference between the carrying amount of the financial liability derecognized and the consideration paid,
including any noncash assets transferred or liabilities assumed, is recognized in profit or loss.
c.Derivative financial instruments
The Corporation uses a variety of derivative financial instruments to manage its exposure to price changes and
foreign exchange rate risks, including foreign exchange forward contracts and petroleum swap contracts.
Derivatives are initially recognized at fair value at the date the derivative contracts are entered into and are
subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is
recognized in profit or loss immediately. When the fair value of a derivative financial instrument is positive, the
derivative is recognized as a financial asset; otherwise, the derivative is recognized as a financial liability.
Hedge Accounting
a.Fair value hedges
Changes in the fair value of derivatives that are designated and quality as fair value hedges are recognized in
profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are
attributable to the hedge-related risk. The change in the fair value of the hedging instrument and the change in
the hedged item attributable to the hedge-related risk are recognized in profit or loss in the line item relating to
the hedged item.
Hedge accounting is discontinued prospectively when the Corporation revokes the designated hedging
relationship; when the hedging instrument expires or is sold, terminated, or exercised; or or when it no longer
meets the criteria for hedge accounting.
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