169
ANNUAL REPORT 2016
NOTES TOTHE FINANCIAL STATEMENTS
30 JUNE 2016
(Continued)
37. FINANCIAL INSTRUMENTS (continued)
(d)
Fair value hierarchy
Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable
for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3 fair value measurements are those derived from inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
The valuation techniques and significant unobservable inputs used in determining the fair value measurement of Level 3 financial
instruments as well as the relationship between key unobservable inputs and fair value, is detailed in the table below.
Financial instruments
Significant unobservable inputs
Inter-relationship between key unobservable inputs
and fair value
Financial assets
Club memberships
Counter party quotation
The higher the counter party quotation, the higher the
fair value of the club memberships
Financial liabilities
Contingent consideration for
business combination
Estimated probabilities of achieving the
profit targets as set out in the sale and
purchase agreement and discount rate
The higher the estimated probabilities, the higher the
fair value of the contingent considerations for business
combinations would be; the higher the discount
rate, the lower the fair value of the contingent
considerations for business combinations
