Notes to the consolidated financial statements 30 June 2022 (continued) 10 Financial assets (continued) (a) Financial assets at fair value through profit or loss The Group classifies financial assets at fair value through profit or loss if they are acquired principally for the purpose of selling in the short term, ie are held for trading. They are presented as current assets if they are expected to be sold within 12 months after the end of the reporting period; otherwise they are presented as non-current assets. Refer to note 22(d) for fair value measurement. (i) Amounts recognised in profit or loss Changes in fair values of financial assets at fair value through profit or loss are recorded in fair value movement of financial assets in the profit or loss. During the current year, the changes in fair values of financial assets resulted in a gain to the profit or loss of $11.4 million (2021: $10.0 million). (b) Financial assets at fair value through other comprehensive income (i) Classification of financial assets at fair value through other comprehensive income Financial assets at fair value through other comprehensive income (FVOCI) comprise equity securities which are not held for trading and which the Group has irrevocably elected at initial recognition to recognise in this category. These are strategic investments for which the Group considers this classification to be more relevant. (ii) Equity investments at fair value through other comprehensive income Equity investments at FVOCI comprise the Group's investment in an ASX listed entity which was acquired as a result of the acquisition of Western Areas Limited during the period (refer note 23). The fair value of the Group's investment at FVOCI at 30 June 2022 is $81.6 million (2021: $nil). Refer to note 22(d) for fair value measurement. (c) Fair value and risk exposure Information about the methods and assumptions used in determining fair value is provided in note 22(d). For an analysis of the sensitivity of the financial assets to price refer to note 22(a)(iii). 11 Trade and other payables 2022 $M 2021 $M Current liabilities Trade and other payables 149.2 47.3 149.2 47.3 (a) Recognition and measurement These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months from the reporting date. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method. Notes to the consolidated financial statements 30 June 2022 (continued) 12 Provisions 2022 $M 2021 $M Current Provision for employee entitlements 17.2 8.7 17.2 8.7 2022 $M 2021 $M Non-current Provision for employee entitlements 3.8 2.7 Provision for rehabilitation costs 78.4 44.6 82.2 47.3 (a) Movements in provisions Movements in the provision for rehabilitation costs during the financial year are set out below: 2022 $M 2021 $M Carrying amount at beginning of financial year 44.6 66.6 Adjustment to provision (7.6) 7.7 Additional provision on acquisition of subsidiary 40.7 - Rehabilitation and restoration borrowing costs expense 0.7 0.6 Payments during the year - (0.1) Disposal of joint venture - (30.2) Carrying amount at end of financial year 78.4 44.6 (b) Recognition and measurement Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. Provisions are not recognised for future operating losses. Provisions are measured at the present value of management's best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. (i) Rehabilitation and restoration Long-term environmental obligations are based on the Group’s environmental management plans, in compliance with current environmental and regulatory requirements. Full provision is made based on the net present value of the estimated cost of rehabilitating and restoring the environmental disturbance that has occurred up to the reporting date. To the extent that future economic benefits are expected to arise, these costs are capitalised and amortised over the remaining lives of the mines. Annual increases in the provision relating to the change in the net present value of the provision are recognised as finance costs (and disclosed within Borrowing and finance costs in the profit or loss). The estimated costs of rehabilitation are reviewed annually and adjusted as appropriate for changes in legislation, technology or other circumstances. Cost estimates are not reduced by the potential proceeds from the sale of assets or from plant clean-up at closure. Notes to the consolidated financial statements 30 June 2022 Notes to the consolidated financial statements 30 June 2022 108 — IGO ANNUAL REPORT 2022 IGO ANNUAL REPORT 2022 — 109
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