b'STAATSOLIE MAATSCHAPPIJ SURINAME N.V.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019 (Continued)changesincreditrisk,butinsteadrecognizesa Loans and borrowingslossallowancebasedonlifetimeECLsateachreportingdate.TheGrouphasestablisheda ThisisthecategorymostrelevanttotheGroup.provisionmatrixthatisbasedonitshistoricalcredit Afterinitialrecognition,interestbearingloanslossexperience,adjustedforforward-looking andborrowingsaresubsequentlymeasuredatfactorsspecifictothedebtorsandtheeconomic amortizedcostusingtheEIRmethod.Gainsenvironment. andlossesarerecognizedintheconsolidatedstatementofprofitorlosswhentheliabilitiesTheGroupconsidersafinancialassetindefault arederecognizedaswellasthroughtheEIRwhencontractualpaymentsare90dayspast amortizationprocess.Amortizedcostiscalculateddue.However,incertaincases,theGroup by taking into account any discount or premium on mayalsoconsiderafinancialassettobein acquisitionandfeesorcoststhatareanintegraldefaultwheninternalorexternalinformation partoftheEIR.TheEIRamortizationisincludedindicates,thattheGroupisunlikelytoreceivethe infinancecostsintheconsolidatedstatementofoutstandingcontractualamountsinfull,before profitorloss.Thiscategorygenerallyappliestoconsidering any credit enhancements held by theinterest-bearingloansandborrowings.Group.Afinancialassetiswrittenoffwhenthereisnoreasonableexpectationofrecoveringthe Derecognitioncontractualcashflows. Afinancialliabilityisderecognizedwhenthe(ii) Financial liabilities obligation under the liability is discharged or cancelledorexpires.WhenanexistingfinancialInitial recognition and measurementliability is replaced by another from the same Financialliabilitiesareclassified,atinitial lenderonsubstantiallydifferentterms,orthetermsrecognition,asfinancialliabilitiesatfairvalue ofanexistingliabilityaresubstantiallymodified,throughprofitorloss,loansandborrowingsand suchanexchangeormodificationistreatedaspayables. the derecognition of the original liability and the recognitionofanewliability.ThedifferenceintheAllfinancialliabilitiesarerecognizedinitiallyatfair respectivecarryingamountsisrecognizedinthevalueand,inthecaseofloansandborrowingsand consolidatedstatementofprofitorloss.payables,netofdirectlyattributabletransaction (iii) Offsetting of financial instruments costs.TheGroupsfinancialliabilitiesincludetradeandotherpayables,loansandborrowings Financialassetsandfinancialliabilitiesareoffsetincludingbankoverdrafts. and the net amount is reported in the consolidated statementoffinancialpositionifthereisacurrentlySubsequent measurementenforceablelegalrighttooffsettherecognizedThemeasurementoffinancialliabilitiesdepends amounts and there is an intention to settle on a net ontheirclassification,asdescribedbelow: basis,torealizetheassetsandsettletheliabilitiessimultaneously.Financial liabilities at fair value through profit or loss n. Derivative Financial instruments Financialliabilitiesatfairvaluethroughprofitor TheGroupentersintoforwardcurrencycontractslossincludefinancialliabilitiesheldfortrading to manage its foreign currency exposures. andfinancialliabilitiesdesignateduponinitialrecognitionasatfairvaluethroughprofitorloss. TherelatedderivativeinstrumentisinitiallyFinancialliabilitiesareclassifiedasheldfortrading recordedatfairvalueonthedateonwhichtheif they are incurred for the purpose of repurchasingcontractisenteredintoandaresubsequentlyin the near term.remeasuredatfairvalue.ThederivativesarecarriedasfinancialassetswhenthefairvalueisGains or losses on liabilities held for trading arepositiveandasfinancialliabilitieswhenthefairrecognizedinthestatementofprofitorloss. valueisnegative.Financialliabilitiesdesignateduponinitial Theforwardcontractisnotdesignatedashedgerecognitionatfairvaluethroughprofitorlossare instruments.designatedattheinitialdateofrecognition,and o. Inventories onlyifthecriteriainIFRS9aresatisfied.TheGrouphasnotdesignatedanyfinancialliabilityas Petroleumproductsarevaluedatthelowerofcostatfairvaluethroughprofitorloss. andnetrealizablevalue.52 STAATSOLIE 2019 ANNUAL REPORT'