188 SECTION 05 : FINANCIAL STATEMENTS & OTHERS Notes To The Financial Statements (Cont’d) 31 March 2025 Registration No: 92 199201005296 (236800 - T) 30. FINANCIAL INSTRUMENTS (continued) (b) Determination of fair value (continued) The methods and assumptions used to estimate fair values of financial assets and financial liabilities are as follows: (continued) (iv) Short term funds The fair values of short term funds are determined by reference to the exchange quoted market bid prices at the close of the business at the end of each reporting period. (v) Forward foreign currency contracts The fair value of a forward foreign exchange contract is the amount that would be payable or receivable upon termination of the outstanding position arising and valued using a valuation technique with market observable inputs. The derivatives arising from the forward currency contracts are stated at fair value using the prevailing market rate. The fair value changes are attributable to changes in foreign exchange spot and forward rate. (c) Fair value hierarchy Fair value is categorised into different levels in a fair value hierarchy based on the input used in the valuation technique as follows: - 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). - 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 Group recognises transfers between levels of the fair value hierarchy as of the date of the event of change in circumstances that causes the transfers.
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