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Financial instruments by category

12 Months Ended

Jun. 30, 2023

14. Financial instruments by category

The following note presents the financial assets and financial liabilities by category and a reconciliation to the corresponding line in the Consolidated Statement of Financial Position, as appropriate. Since the line items “Trade and other receivables” and “Trade and other payables” contain both financial instruments and non-financial assets or liabilities (such as prepayments, trade receivables, trade payables in-kind and tax receivables and payables), the reconciliation is shown in the columns headed “Non-financial assets” and “Non-financial liabilities”. Financial assets and liabilities measured at fair value are assigned based on their different levels in the fair value hierarchy.

IFRS 9 defines the fair value of a financial instrument as the amount for which an asset could be exchanged, or a financial liability settled, between knowledgeable, willing parties in an arm’s length transaction. All financial instruments recognized at fair value are allocated to one of the valuation hierarchy levels of IFRS 7. This valuation hierarchy provides for three levels.

In the case of Level 1, valuation is based on quoted prices (unadjusted) in active markets for identical assets and liabilities that the Company can refer to at the date of valuation. In the case of Level 2, fair value is determined by using valuation methods based on inputs directly or indirectly observable in the market. If the financial instrument concerned has a fixed contract period, the inputs used for valuation must be observable for the whole of this period. In the case of Level 3, the Group uses valuation techniques not based on inputs observable in the market. This is only permissible insofar as no market data is available. The inputs used reflect the Group’s assumptions regarding the factors which market players would consider in their pricing.

The Group’s Finance Division has a team in place in charge of estimating the valuation of financial assets required to be reported in the Consolidated Financial Statements, including the fair value of Level-3 instruments. The team directly reports to the Chief Financial Officer ("CFO"). The CFO and the valuation team discuss the valuation methods and results upon the acquisition of an asset and, as of the end of each reporting period.

According to the Group’s policy, transfers among the several categories of valuation are recognized when occurred, or when there are changes in the prevailing circumstances requiring the transfer.

Financial assets and financial liabilities as of June 30, 2023 are as follows:

	Financial assets at amortized cost		Financial assets at fair value through profit or loss				Subtotal financial assets		Non-financial assets		Total
			Level 1		Level 2
June 30, 2023
Assets as per Statements of Financial Position
Trade and other receivables (excluding the allowance for doubtful accounts and other receivables) (Note 15)		24,152		-		-		24,152		7,354		31,506
Investments in financial assets:
- Public companies’ securities		-		5,046		-		5,046		-		5,046
- Mutual funds		-		20,152		-		20,152		-		20,152
- Bonds		-		9,215		-		9,215		-		9,215
- Others		627		1,294		-		1,921		-		1,921
Cash and cash equivalents:
- Cash at bank and on hand		5,254		-		-		5,254		-		5,254
- Short-term investments		-		3,481		-		3,481		-		3,481
Total assets		30,033		39,188		-		69,221		7,354		76,575

	Financial liabilities at amortized cost		Financial liabilities at fair value through profit or loss				Subtotal financial liabilities		Non-financial liabilities		Total
			Level 1		Level 2
June 30, 2023
Liabilities as per Statements of Financial Position
Trade and other payables (Note 18)		15,215		-		-		15,215		20,228		35,443
Borrowings (Note 20)		107,941		-		-		107,941		-		107,941
Derivative financial instruments:
- Bond futures		-		6		-		6		-		6
Total liabilities		123,156		6		-		123,162		20,228		143,390

Financial assets and financial liabilities as of June 30, 2022 were as follows:

	Financial assets at amortized cost		Financial assets at fair value through profit or loss				Subtotal financial assets		Non-financial assets		Total
			Level 1		Level 2
June 30, 2022
Assets as per Statements of Financial Position
Trade and other receivables (excluding the allowance for doubtful accounts and other receivables) (Note 15)		25,993		-		-		25,993		8,544		34,537
Investments in financial assets:
- Public companies’ securities		-		2,902		-		2,902		-		2,902
- Mutual funds		-		29,901		-		29,901		-		29,901
- Bonds		-		8,205		-		8,205		-		8,205
- Others		22		571		-		593		-		593
Cash and cash equivalents:
- Cash at bank and on hand		21,591		-		-		21,591		-		21,591
- Short term investments		-		5,952		-		5,952		-		5,952
Total assets		47,606		47,531		-		95,137		8,544		103,681

	Financial liabilities at amortized cost		Financial liabilities at fair value through profit or loss				Subtotal financial liabilities		Non-financial liabilities		Total
			Level 1		Level 2
June 30, 2022
Liabilities as per Statements of Financial Position
Trade and other payables (Note 18)		9,572		-		-		9,572		16,472		26,044
Borrowings (Note 20)		161,112		-		-		161,112		-		161,112
Derivative financial instruments:
- Swaps		-		-		34		34		-		34
Total liabilities		170,684		-		34		170,718		16,472		187,190

(i) The fair value of financial assets and liabilities at their amortized cost does not differ significantly from their book value, except for borrowings (Note 20).

The following are details of the book value of financial instruments recognized, which were offset in the statements of financial position:

	06.30.2023							06.30.2022
	Gross amounts recognized		Gross amounts offset			Net amount presented		Gross amounts recognized		Gross amounts offset			Net amount presented
Financial assets
Trade and other receivables (excluding the allowance for doubtful accounts and other receivables)		25,635		(1,483	)		24,152		27,136		(1,143	)		25,993
Financial liabilities
Trade and other payables		13,732		1,483			15,215		8,429		1,143			9,572

Income, expense, gains and losses on financial instruments can be assigned to the following categories:

	Financial assets / liabilities at amortized cost			Financial assets / liabilities at fair value through profit or loss		Total
June 30, 2023
Interest income		825			-		825
Interest expense		(11,909	)		-		(11,909	)
Interest expense on lease liabilities		(222	)		-		(222	)
Foreign exchange gains, net		6,762			-		6,762
Gain from repurchase of NCN		199			-		199
Fair value gain on financial assets at fair value through profit or loss		-			7,407		7,407
Interest and allowances generated by operating credits		661			-		661
Gain on derivative financial instruments, net		-			46		46
Other finance costs		(1,895	)		-		(1,895	)
Total financial instruments (i)		(5,579	)		7,453		1,874

	Financial assets / liabilities at amortized cost			Financial assets / liabilities at fair value through profit or loss		Total
June 30, 2022
Interest income		998			-		998
Interest expense		(17,614	)		-		(17,614	)
Interest expense on lease liabilities		(259	)		-		(259	)
Foreign exchange gains, net		31,056			-		31,056
Gain from repurchase of NCN		3,148			-		3,148
Fair value gain on financial assets at fair value through profit or loss		-			3,134		3,134
Interest and allowances generated by operating credits		276			-		276
Gain on derivative financial instruments, net		-			70		70
Other finance costs		(996	)		-		(996	)
Total financial instruments (i)		16,609			3,204		19,813

	Financial assets / liabilities at amortized cost			Financial assets / liabilities at fair value through profit or loss			Total
June 30, 2021
Interest income		1,274			-			1,274
Interest expense		(22,658	)		-			(22,658	)
Interest expense on lease liabilities		(341	)		-			(341	)
Foreign exchange gains, net		24,818			-			24,818
Dividend income		2			-			2
Loss from repurchase of NCN		(336	)		-			(336	)
Fair value gain on financial assets at fair value through profit or loss		-			18,799			18,799
Interest and allowances generated by operating credits		342			-			342
Loss on derivative financial instruments, net		-			(1,597	)		(1,597	)
Other finance costs		(3,061	)		-			(3,061	)
Total financial instruments (i)		40			17,202			17,242

(i)	Included within “Financial results, net“ in the Consolidated Statement of Income and Other Comprehensive Income, with the exception of interest and discount generated by operating assets, which are included within "Other operating results, net".

The following table presents the changes in Level 3 financial instruments as of June 30, 2022 and 2021:

	Investments in financial assets - Others			Total
Balances at June 30, 2021		170			170
Currency translation adjustment		(17	)		(17	)
Write off		(207	)		(207	)
Gain for the year (i)		54			54
Balances at June 30, 2022 (ii)		-			-

(i)	Included within “Financial results, net” in the Consolidated Statement of Income and Other Comprehensive Income.
(ii)	During the year ended June 30, 2023 there were no changes in Level 3 financial instruments.

During the fiscal year ended June 30, 2023 and 2022, there were no transfers between levels of hierarchy of the fair value. When there are no quoted prices available in an active market, fair values (especially derivative instruments) are based on recognized valuation methods. The Group uses a range of valuation models for the measurement of Level 2 and Level 3 instruments, details of which may be obtained from the following table.

Description		Pricing model / method		Parameters		Fair value hierarchy		Range
Derivative financial instruments Swaps		Theoretical price		Underlying asset price and volatility		Level 2			-

As of June 30, 2023, there are no changes in economic or business circumstances that affect the fair value of the Group's financial assets and liabilities that were not considered in the fair value estimation.