NOTES TO THE FINANCIAL STATEMENTS 31 DECEMBER 2024 (CURRENCY – SINGAPORE DOLLARS UNLESS OTHERWISE STATED) C15 Classification and fair value of financial instruments (continued) Recognition and measurement (continued) (b) Fair value The Group has an established approach with respect to the measurement of fair values. Fair value hierarchy The Group classifies fair value measurement using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The following table shows the levels of fair value hierarchy, and the respective valuation technique used in measuring the fair values, as well as significant unobservable inputs: Types of financial instruments Valuation method Level 1 FVOCI – Equity investments (quoted) FVTPL – Equity investments (quoted) Determined by reference to their quoted bid prices for these investments as at reporting date. Determined by reference to their quoted bid prices for these investments as at reporting date. Level 2 FVOCI – Equity investments (unquoted) Determined by reference to the most recent purchase price. Derivatives – Forward currency contracts – Interest rate swaps – Embedded derivatives Determined based on broker quotes. Similar contracts are traded in an active market and the quotes reflect the actual transactions in similar instruments. FVTPL – Investment in associates – Equity investments (unquoted) Determined by reference to the most recent purchase price. Level 3 FVOCI – Equity investment (unquoted) FVTPL – Investment in associates – Equity investments (unquoted) Determined based on latest funding round. Determined based on valuation performed using adjusted market multiples. Changing one or more of the inputs to reasonable alternative assumptions is not expected to have a material impact on the changes in fair value. 202 ST ENGINEERING | ANNUAL REPORT 2024
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