NOTES TO THE FINANCIAL STATEMENTS l NOTE 37

37.

Fair value hierarchy and financial instruments by category

  Accounting policies have been applied to financial instruments as indicated below.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the group takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date.

In addition, for financial reporting purposes, fair value measurements are categorised into level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety. The three levels are explained as follows:

Level 1 — inputs are quoted prices in active markets for identical assets or liabilities that the company can access at the measurement date. These quoted prices are unadjusted.
Level 2 — inputs are inputs, other than quoted prices included in level 1, that are observable for the asset or liability, either directly or indirectly.
Level 3 — inputs are unobservable inputs for the asset or liability.

The table below categorises financial instruments and analyses those measured at fair value by the level into which the fair value measurement is categorised:

Group

          Recurring fair value measurements  
Assets Loans and
receivables
at amortised
cost
R000
  Assets
designated
at fair value
through
profit and loss
R000
  Level 1
R000
  Level 2
R000
  Level 3
R000
 
30 June 2014                    
Derivative instruments(1)     32 978       32 978      
Loans receivable 812 459                  
Receivables 103 686                  
Cash and cash equivalents 77 353                  
30 June 2013                    
Listed property securities     2 279 253   2 279 253          
Derivative instruments(1)     39 857       39 857      
Loans receivable 384 307                  
Receivables 224 175                  
Cash and cash equivalents 74 821                  
Liabilities                    
30 June 2014                    
Debentures and debenture premium 5 719 119                  
Loans — long term 5 185 822                  
         — short term 2 013 031                  
Derivative instruments(1)     41 829       41 829      
Payables 367 686                  
30 June 2013                    
Debentures and debenture premium 5 822 497                  
Loans — long term 4 436 486                  
         — short term 948 000                  
Derivative instruments(1)     52 984   52 984   39 857      
Payables 353 802                  
(1) Refer to note 19 for revaluation techniques and key inputs

Company

          Recurring fair value measurements  
Assets Loans and
receivables
at amortised
cost
R000
  Assets
designated
at fair value
through
profit and loss
R000
  Level 1
R000
  Level 2
R000
  Level 3
R000
 
30 June 2014                    
Derivative instruments(1)     32 978       32 978      
Loans receivable 47 674                  
Receivables 102 629                  
Cash and cash equivalents 61 257                  
30 June 2013                    
Listed property securities     2 279 253   2 279 253          
Derivative instruments(1)     39 857       39 857      
Loans receivable 165 186                  
Receivables 219 293                  
Cash and cash equivalents 70 625                  
Liabilities                    
30 June 2014                    
Debentures and debenture premium 5 730 187                  
Loans — long term 3 792 566                  
         — short term 2 013 031                  
Derivative instruments(1)     39 811       39 811      
Payables 335 626                  
30 June 2013                    
Debentures and debenture premium 5 822 497                  
Loans — long term 4 103 914                  
         — short term 948 000                  
Derivative instruments(1)     52 984       52 984      
Payables 345 669                  
(1) Refer to note 19 for revaluation techniques and key inputs

The directors consider that the carrying amounts of financial assets and liabilities recognised at amortised cost in the consolidated financial statements approximate their fair values. There have been no changes in valuation methodologies during the year.

There have been no significant transfers between level 1, level 2 and level 3 during the year.

The fair value gain/loss (in respect of investment property and all other financial assets) included in profit and loss is R1,5 billion (2013: R1,4 billion) for the group and R1,5 billion (2013: R1,4 billion) for the company.

NOTES TO THE FINANCIAL STATEMENTS l NOTE 37