SIGA_Annual_Report_2015 - page 63

As part of its customer loyalty initiative, SIGA offers a players club program to patrons. Under the program, club members accumulate
reward points based on amounts wagered on slot machines. Members can redeem their points for cash or vouchers for free or discounted
goods or services. SIGA records the points earned as a reduction of gaming revenue. Accounts payable and accrued liabilities are accrued
for the estimated cost of the earned points balance at the end of the period under the player’s club program. If the patron chooses to
redeem their points for a voucher for free or discounted goods or services, the revenue is determined by the fair value of the undelivered
goods and services related to a customer loyalty program and remains in accounts payable and accrued liabilities until the promotional
consideration is provided.
A defined contribution pension plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity
and will have no legal or constructive obligation to pay further amounts. SIGA’s matching contributions to the defined contribution pension
plan for employees are recorded as salaries and benefits expense in the statement of comprehensive income when services are rendered
by employees.
Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.
Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to SIGA’s functional currency at the
exchange rate at that date. Revenues and expenses are translated at rates of exchange prevailing on the transaction dates. Translation
gains and losses on foreign currency denominated monetary items are taken into income in the current year.
Classification and measurement
All financial instruments are initially measured at fair value, plus transaction costs, except in the case of financial assets and liabilities
classified as fair value through profit or loss (“FVTPL”). The classification of financial instruments at initial recognition depends on the purpose
and management’s intention for which the financial instruments were acquired or issued, their characteristics and SIGA’s designation of such
instruments. Measurement in subsequent periods depends on whether the financial instruments have been classified as FVTPL, loans and
receivables, and other liabilities. An explanation of the nature of these classifications follows. SIGA’s classifications of its financial instruments
are disclosed in Note 20.
Financial assets are classified as at FVTPL when the financial asset is either held-for-trading or it is designated as at FVTPL.
A financial asset is classified as held-for-trading if:
It has been acquired principally for the purpose of selling it in the near term; or
On initial recognition it is part of a portfolio of identified financial instruments that SIGA manages together and has a recent actual pattern
of short-term profit-taking; or
It is a derivative that is not designated and effective as a hedging instrument.
A financial asset other than a financial asset held-for-trading may be designated as FVTPL upon initial recognition if:
Such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or
The financial asset forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is
evaluated on a fair value basis, in accordance with SIGA’s documented risk management or investment strategy, and information .
about the grouping is provided internally on that basis; or
It forms part of a contract containing one or more embedded derivatives, and IAS 39, Financial Instruments:
Recognition and
permits the entire combined contract (asset or liability) to be designated as at FVTPL.
Financial instruments classified as FVTPL are subsequently measured at fair value, with changes in fair value recognized in comprehensive
income. The net gain or loss recognized in comprehensive income incorporates any dividend or interest earned on the financial asset. .
Fair value is determined in the manner described in Note 20.
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