ANNUAL INTEGRATED REPORT 2021
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ANNUAL INTEGRATED REPORT 2021 | AXTEL
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The difference between the carrying value of the financial liability
derecognized and the consideration paid and payable is recognized
in profit or loss.
Additionally, when the Company carries out a refinancing transaction
and the previous liability qualifies to be derecognized, the costs
incurred in the refinancing are recognized immediately in results as
of the date of termination of the previous financial liability.
Offsetting of financial assets and liabilities
Financial assets and liabilities are offset and the net amount is
presented in the consolidated statement of financial position
when there is a legally enforceable right to offset the recognized
amounts, and there is an intention to settle them on a net basis or
to realize the asset and settle the liability simultaneously.
h. Derivative financial instruments and hedging activities
All derivative financial instruments are identified and classified
as fair value hedges or cash flow hedges, for trading or hedging
of market risk, are recognized in the consolidated statement
of financial position as assets and/or liabilities at fair value and
subsequently measured at fair value. Fair value is determined
based on recognized market prices and when non-quoted in an
observable market, it is determined using valuation techniques
accepted in the financial sector.
Fair value of hedging derivatives is classified as a non-current asset
or liability if the remaining maturity of the hedged item is more
than 12 months and as a current asset or liability if the remaining
maturity of the hedged item is less than 12 months.
Derivative financial instruments classified as hedges are contracted
for risk hedging purposes and meet all hedging requirements;
their designation at the beginning of the hedging operation is
documented, describing the objective, primary position, risks
to be hedged and the effectiveness of the hedging relationship,
characteristics, accounting recognition and how the effectiveness
will be measured, applicable to that operation.
Fair value hedges
Changes in the fair value of derivative financial instruments are
recorded in the consolidated statements of income. The change
in fair value hedges and the change in the primary position
attributable to the hedged risk are recorded in the consolidated
statement of income in the same line item as the hedged position.
As of December 31, 2021, 2020 and 2019, the Company has no
derivative financial instruments classified as fair value hedges.
Cash flow hedges
The changes in the fair value of derivative instruments associated
to cash flow hedges are recorded in stockholders' equity. The
effective portion is temporarily recorded in comprehensive (loss)
income, within stockholders' equity and is reclassified to profit or
loss when the hedged position is affected; the ineffective portion is
immediately recorded in profit or loss.View entire presentation