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Year ended December 31, 2014 

## 3. Significant accounting policies(continued): 

## (l) Financial instruments (continued): 

 Financial liabilities at amortized cost: Financial liabilities at amortized cost include accounts payable and accrued liabilities, and the amount drawn on the Company’s bank loan. These items are initially recognized at theamount required to be paid less, when material, a discount to reduce the payables to fair value or transaction costs incurred. Subsequently, these items are measured at amortized cost using the effective interest rate method. 

Financial liabilities are classified as current liabilities if payment is due within twelve months. Otherwise, they are presented as non -current liabilities. 

The Company must classify fair value measurements according to a hierarchy that reflects the significance of the inputs usedin performing such measurements. TheCompany’s fair value hierarchy comprises the following levels: 

 Level 1 – quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which tr ansactions occur in sufficient frequency and volume to provide pricing information on an ongoing basis. 

 Level 2 – pricing inputs are other than quoted in active markets included in Level 1. Prices in Level 2 are either directly or indirectly observable as  of the reporting date. 

 Level 3 – valuations in this level are those with inputs for the asset or liability that are not based on observable data. 

The following table presents the carrying amounts of each category of financial assets and liabilities: 

<img src='content_image/212434.jpg'>

