2013 — Page 87

13 FIXED ASSETS (Continued)

(a)

Fair value measurement of investment properties

(i)

Fair value hierarchy

Hong Kong Ferry (Holdings) Company Limited Annual Report 2013

Notes to the Accounts (Continued)

The following table presents the fair value of the Group's investment properties measured at the balance

sheet date on a recurring basis, categorised into the three-level fair value hierarchy as defined in HKFRS

13, Fair value measurement. The level into which a fair value measurement is classified is determined with

reference to the observability and significance of the inputs used in the valuation technique as follows:

Level 1 valuations: Fair value measured using only Level 1 inputs i.e. unadjusted quoted prices in

active markets for identical assets or liabilities at the measurement date

Level 2 valuations: Fair value measured using Level 2 inputs i.e. observable inputs which fail to

meet Level 1, and not using significant unobservable inputs. Unobservable inputs are inputs for

which market data are not available

Level 3 valuations: Fair value measured using significant unobservable inputs

Fair value at

31 December

Fair value measurements as at

31 December 2013 categorised into

The Group

Recurring fair value

measurement

Investment properties

2013

HK$'000

Level 1

HK$'000

Level 2

HK$'000

Level 3

HK$'000

1,251,900

1,251,900

During the year ended 31 December 2013, there were no transfers between Level 1 and Level 2, or transfers into or out of Level 3. The Group's policy is to recognise transfers between levels of fair value hierarchy as at the end of the reporting period in which they occur.

Valuation process

All the Group's investment properties were revalued as at 31 December 2013. The valuations were carried out by an independent firm of surveyors, DTZ Debenham Tie Leung Limited, who have among their staff Members of the Hong Kong Institute of Surveyors with recent experience in the location and category of property being valued, on a market value basis. The management has discussion with the surveyors on the valuation assumptions and valuation results when the valuation is performed at each interim and annual reporting date.

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