FGV Annual Report 2016

FELDA GLOBAL VENTURES HOLDINGS BERHAD 214 FINANCIAL REPORT NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2016 4 FINANCIAL RISK MANAGEMENT (CONTINUED) (c) Fair value estimation (continued) There were no transfers between levels 1 and 2 during the year. (i) Financial instruments in Level 1 The fair value of financial instruments traded in active markets is based on quoted market prices at the statement of financial position date. The quoted market price used for financial assets held by the Group is the current bid price. These instruments are included in Level 1. Instruments included in Level 1 comprise primarily equity investments listed in Bursa Malaysia Securities Berhad or foreign stock exchanges classified as trading securities or available-for-sale and commodity derivatives quoted on Malaysia Derivatives Exchange ("MDEX") for palm oil and other foreign commodity exchanges. (ii) Financial instruments in Level 2 The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2. Instruments included in Level 2 comprise foreign currency forward contracts and available-for-sales financial assets invested in certain unit trusts. If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. (iii) Financial instruments in Level 3 The following table present the changes in recurring Level 3 financial instruments during the financial year: Group 2016 RM'000 2015 RM'000 LLA liability At 1 January 4,627,195 4,680,829 Fair value changes charged to profit or loss 68,275 224,861 Repayment during the year (287,906) (278,495) At 31 December 4,407,564 4,627,195 Available for sale financial assets At 1 January 251,351 218,839 Additions 5,488 9,613 Liquidation of a subsidiary (1,613) - Fair value changes transferred to available-for-sale reserves (7,684) 22,899 At 31 December 247,542 251,351 (d) Offsetting financial assets and financial liabilities There are no offsetting of financial assets and financial liabilities during the year for the Group and Company.