Page 99 - Annual Report

HONG KONG ACADEMY OF MEDICINE
香 港 醫 學 專 科 學 院
香港醫學專科學院
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

19. FINANCIAL INSTRUMENTS (Continued)

d) Currency risk

The Group’s functional currency is Hong Kong dollars. The Group is exposed to currency risk
through cash and bank balances denominated in Renminbi (“RMB”) and United States dollars
(“USD”). As the Hong Kong dollar (“HKD”) is pegged to the USD, the Group does not expect any
significant movements in the USD/HKD exchange rate. At 31 December 2023, it is estimated
that a general increase or decrease in 5% of exchange rates, with all variables held constant,
would increase/decrease the Group’s surplus for the year and increase/decrease the Group’s
general fund by approximately HK$17,000 (2022: HK$15,000).

e) Fair values measurement

Fair value hierarchy

The following table presents the fair value of the Group’s financial instruments measured at the
end of the reporting period on a recurring basis, categorised into the three-level fair value
hierarchy as defined in HKFRS 13, Fair value measurement. The level into which a fair value
measurement is classified is determined with reference to the observability and significance of
the inputs used in the valuation technique as follows:

• Level 1 valuations: Fair value measured using only Level 1 inputs i.e. unadjusted quoted
prices in active markets for identical assets or liabilities at the measurement date.

• Level 2 valuations: Fair value measured using Level 2 inputs i.e. observable inputs which
fail to meet Level 1, and not using significant unobservable inputs. Unobservable inputs
are inputs for which market data are not available.

• Level 3 valuations: Fair value measured using significant unobservable inputs.

Fair value as at Valuation Significant
31 December 31 December Fair value techniques and unobservable
Financial assets 2023 2022 hierarchy key inputs inputs
HK$ HK$

Investments in equity
instruments designated at
FVTOCI
Quoted bid prices
Listed equity securities 4,261,842 4,483,002 Level 1 in an active market N/A

At 31 December 2023 and 2022, all financial instruments measured at fair value fall into level 1
of the fair value hierarchy described above.

f) Price risk

The Group is exposed to equity price changes arising from listed equity investments. The
Group’s listed investments are listed on recognised stock exchange. Listed investments held in
the investments in equity instruments designated at FVOCI have been chosen based on their
longer term growth potential and are monitored regularly for performance against expectations.

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香港醫學專科學院 2024 年度報告