Credit Union Annual Report 2022 - Flipbook - Page 58
THE CAYMAN ISLANDS CIVIL SERVICE ASSOCIATION (CICSA)
CO-OPERATIVE CREDIT UNION LIMITED
NOTES TO FINANCIAL STATEMENTS (continued)
July 31, 2022
2.4 Summary of accounting policies (continued)
Members’ shares
Member shares are generally redeemable at the option of the holder of the shares, subject to certain conditions. As a
result, member shares are presented as financial liabilities and are not reclassified to equity as all reclassification criteria
within IAS 32 and IFRIC (“International Financial Reporting Interpretations Committee”) 2 are not met.
Other provision
Provisions for legal claims costs are recognized when the Credit Union has a present legal or constructive obligation as a
result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount
has been reliably estimated. Provisions are not recognized for future operating losses.
Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a
rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The
increase in the provision due to passage of time is recognized as interest expense.
Fair value measurement
The fair value of financial instruments is the price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction in the principal (or most advantageous) market at the measurement date under current market
conditions (i.e., an exit price) regardless of whether that price is directly observable or estimated using another valuation
technique. When the fair values of financial assets and financial liabilities recorded in the statement of financial position
cannot be derived from active markets, they are determined using a variety of valuation techniques that include the use of
valuation models. The inputs to these models are taken from observable markets where possible, but where this is not
feasible, estimation is required in establishing fair values. Judgements and estimates include considerations of liquidity
and model inputs related to items such as credit risk (both own and counterparty), funding value adjustments, correla tion
and volatility.
Foreign exchange
Monetary assets and liabilities denominated in foreign currencies are translated into Cayman Islands dollars at the
exchange rate prevailing on the balance sheet date. Revenue and expense items denominated in foreign currencies are
translated into Cayman Islands dollars at the exchange rate prevailing on the transaction date. Gains and losses on
translation are included in the Statement of Comprehensive Income.
The Credit Union translates its United States dollars to Cayman Islands dollars at a fixed rate of CI$0.82 to
US$1.00.
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