NOTES TO THE FINANCIAL STATEMENTS
22 Determination of fair values of investment properties and investment properties under development (Cont’d)
Valuation processes applied by the Group
The Group has an established control framework with respect to the measurement of fair values. This framework
includes a real estate team that reports directly to the Chief Executive Officer of the Manager, and has an overall
responsibility for all significant fair value measurements, including Level 3 fair values.
The valuation team regularly reviews significant unobservable inputs and valuation adjustments. If third party
information is used to measure fair value, then the valuation team assesses and documents the evidence
obtained from the third parties to support the conclusion that such valuations meet the requirements of FRS,
including the level in the fair value hierarchy the resulting fair value estimate should be classified.
Significant valuation issues are reported to the Manager’s Board.
Fair value hierarchy
The table below analyses recurring non-financial assets carried at fair value. The different levels have been
defined as follows:
•
Level 1:
quoted prices (unadjusted) in active markets for identical assets and liabilities that the
Group can access at the measurement date;
•
Level 2:
inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly or indirectly; and
•
Level 3:
unobservable inputs for the asset or liability.
If the inputs used to measure the fair value of an asset or a liability are categorised in different levels of the fair
value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value
hierarchy as the lowest level input that is significant to entire measurement (with Level 3 being the lowest).
The Group recognises any transfers between levels of the fair value hierarchy as of the end of the reporting
period during which the transfer has occurred, There were no such transfers during the current and previous year.
The table below analyses non-financial assets carried at fair value.
Level 3
Group and Trust
$’000
31 December 2014
Investment properties (including investment property held for divestment)
1,346,880
31 December 2013
Investment properties (including investment property held for divestment)
1,139,298
Investment properties under development
22,292
1,161,590
CAMBRIDGE INDUSTRIAL TRUST | A WINNING FORMULA
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