ÖBB Annual Report 2023

Consolidated Financial Statements 238 Österreichische Bundesbahnen-Holding Aktiengesellschaft Consolidated Financial Statements | Group Management Report 20 Trade receivables, other receivables and financial assets (e.g. securities) are measured at amortised cost less impairment. Cash and cash equivalents The ÖBB Group reports cash on hand and bank balances with remaining terms to maturity of up to three months since the date of acquisition as cash and cash equivalents. Money market deposits with terms of more than three months are classified as other current financial assets along with securities. Cash and cash equivalents are included in cash and cash equivalents for the cash flow statement. Please refer to Notes 22 and 33 for further details. Trade receivables Trade receivables are recognised from the date on which they arise. Any unconditional right to receive consideration is recognised as a receivable. Trade receivables without significant financing components are initially measured at the transaction price. Equity instruments measured at fair value through profit or loss The Group measures all equity instruments held at fair value through profit or loss. Debt instruments measured at fair value through profit or loss A debt instrument that is neither measured at amortised cost nor at fair value through other comprehensive income, is measured at fair value through profit or loss. The ÖBB Group holds no debt instruments that are recognised at fair value through profit or loss. Derivatives Derivative financial instruments are measured at fair value. Changes in the fair value of derivative financial instruments are recognised in profit or loss or in other comprehensive income, depending on whether the derivative instrument is used to hedge the fair value of an item recognised in the Statement of Financial Position (“fair value hedge”) or fluctuations in future cash flows (“cash flow hedge”). For derivative financial instruments designated to protect items on the statement of financial position, changes fair value of the hedged risks and of the derivative financial instrument are recognised in profit or loss. For derivative financial instruments designated as cash flow hedges, changes in the fair value of the effective portion of the hedging instrument are recognised via other comprehensive income in equity (“cash flow hedge reserve“). The effects reported in the cash flow hedge reserve are recognised in profit or loss when the underlying hedged item affects profit or loss. Changes in the fair value of the ineffective portion of the hedge and changes in the fair value of derivative financial instruments not classified as a hedge are recognised in profit or loss immediately. The ÖBB Group makes use of hedge accounting. See Note 29.3 on hedge accounting. Non-current derivative financial instruments (interest rate swaps for hedging purposes) are divided into a current and a non-current portion based on the discounted payment streams in the applicable time frames. Impairment of financial assets (IFRS 9) The Group assesses the default risk associated with debt instruments measured at amortised cost or at fair value through equity on a forward-looking basis. Default risk is the risk of financial losses if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The carrying amounts financial assets correspond to the maximum default risk. IFRS 9 provides for a general impairment model (three-step model) and a simplified method for determining the expected loss. General impairment model In accordance with the general impairment model, a distinction is made between three stages of impairment. The amount of the impairment loss is measured in accordance with the allocation financial instrument to one of these three stages. The general impairment model is applied to all financial instruments with the exception of trade receivables.