IBERSOL | Annual Report 2021

ANNUAL REPORT 2021 c) Assets measured at fair value through profit or loss Financial assets that do not meet the requirements for classification in the situations referred to above are classified and measured at fair value through profit or loss, residual category under IFRS 9. 2.10.2 Recognition and derecognition Acquisitions and disposals of financial assets are recognized on the date of their ne- gotiation, that is, on the date on which the Group undertakes to acquire or dispose of these financial assets. Financial assets are derecognised when the Group’s contractual rights to the receipt of its future cash flows expire when the Group has substantially transferred all the risks and rewards associated with its detention or when it retains, but not substan- tially, part of the risks and benefits associated with their detention, the Group has transferred control over the assets. 2.10.3 Impairment IFRS 9 establishes a new impairment model based on “expected losses”, which re- places the previous model based on “incurred losses” provided for in IAS 39. In this sense, the Group starts to recognize impairment losses before there is objective evidence of impairment. of value resulting from a past event. This model is the basis for the recognition of impairment losses on financial instruments held whose meas- urement is at amortized cost or at fair value through other comprehensive income. The impairment model depends on the occurrence or not of a significant increase in credit risk since the initial recognition. If the credit risk of a financial instrument has not increased significantly since its initial recognition, the Group recognizes an accumulated impairment equal to the expected loss that is expected to occur in the following 12 months. If the credit risk has increased significantly, the Group recog- nizes an accumulated impairment equal to the expected loss that is estimated to occur up to the respective maturity of the asset. Once the loss event has been verified under the terms of IFRS 9 (“objective proof of impairment”, according to the terminology of IAS 39), the accumulated impairment is directly attributed to the instrument in question, and its accounting treatment, starting from this similar to that provided for in IAS 39, including the treatment of the respective interest. The carrying amount of the asset is reduced and the amount of losses recognized in the income statement. If, in a subsequent period, the amount of impairment decreases, the amount of impairment losses previously recognized is also reversed in the income statement if the decrease in that impairment is objec- tively related to the event after the initial recognition. a) Accounts receivable from customers The Group applies the simplified method and records expected loss to maturity for all its accounts receivable, including those that include a significant financial compo- nent. Estimated expected losses were calculated based on the experience of actual 349