KATHMANDU A NNUAL REPORT  2013 37 (J) CASH AND CASH EQUIVALENTS (K) TRADE RECEIVABLES (L) INVENTORIES (M) INVESTMENTS AND OTHER FINANCIAL ASSETS (I) IMPAIRMENT OF NON-FINANCIAL ASSETS (H) LEASES (G) GOODS AND SERVICES TAX (GST) The Group is the lessee Assets are reviewed for impairment whenever events or changes  in circumstances indicate that the carrying amount may not  be recoverable. Intangible assets that have an indefinite useful  life, including goodwill, are not subject to amortisation and are  tested annually for impairment irrespective of whether any  circumstances identifying a possible impairment have been  identified. An impairment loss is recognised for the amount  by which the asset’s carrying amount exceeds its recoverable  The Group classifies its investments in the following categories:  loans and receivables, and financial assets at fair value through  profit or loss. The classification depends on the purpose for  which the investments were acquired. Regular purchases and  sales of financial assets are recognised on the trade date - the  date on which the Group commits to purchase or sell the asset.  Management determines the classification of its investments at  the initial recognition and re-evaluates this designation at every  reporting date. Leases in which a significant portion of the risks and rewards of  ownership are retained by the lessor are classified as operating  leases. Payments made under operating leases (net of any  incentives received from the lessor) are charged to the income  statement on a straight-line basis over the period of the lease. Inventories are stated at the lower of cost and net realisable  value. Cost is determined on a weighted average cost method  and includes expenditure incurred in acquiring the inventories  and bringing them to their existing location and condition. Net  realisable value is the estimated selling price in the ordinary  course of business, less applicable variable selling expenses. The income statement and the cash flow statement have been prepared so that all components are stated exclusive of GST. All items in the balance sheet are stated net of GST, with the exception of receivables and payables, which include  GST invoiced. Deferred income tax is provided on temporary differences arising  on investments in subsidiaries and associates, except where the  timing of the reversal of the temporary difference is controlled by  the Group and it is probable that the temporary difference will not  reverse in the foreseeable future. The collectability of trade receivables is reviewed on an on-going  basis. Debts, which are known to be uncollectible, are written  off. A provision for doubtful receivables is established when there  is objective evidence that the Group will not be able to collect  all amounts due according to the original terms of receivables.  Significant financial difficulties of the debtor, probability that  the debtor will enter bankruptcy or financial reorganisation, and  default or delinquency in payments are considered indicators  that the trade receivable is impaired. The amount of the provision  is the difference between the asset’s carrying amount and the  present value of estimated future cash flows, discounted at the  effective interest rate. The amount of the provision is recognised  in the income statement. Trade receivables are recognised initially at fair value and  subsequently measured at amortised cost, less provision for  doubtful debts. Cash and cash equivalents includes cash on hand, deposits held  at call with financial institutions, other short-term highly liquid  investments with original maturities of three months or less that  are readily convertible to known amounts of cash and which  are subject to an insignificant risk of changes in value, and bank  overdrafts. Bank overdrafts are shown within borrowings in  current liabilities on the balance sheet. amount. The recoverable amount is the higher of an asset’s fair  value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at  the lowest levels for which there are separately identifiable cash  flows (cash generating units). The current income tax charge is calculated on the basis of the  tax laws enacted or substantively enacted at the balance sheet  date in the countries where the Company’s subsidiaries operate  and generate taxable income. Management periodically evaluates  positions taken in tax returns with respect to situations in which  applicable tax regulations are subject to interpretation and  establishes provisions where appropriate on the basis of amounts  expected to be paid to the tax authorities. Deferred income tax is provided in full, using the liability method,  on temporary differences arising between tax bases of assets and  liabilities and their carrying amounts in the consolidated financial  statements. However, the deferred income tax is not accounted  for if it arises from initial recognition of an asset or liability in a  transaction other than a business combination that at the time of  the transaction affects neither accounting nor taxable profit or loss.  Deferred income tax is determined using tax rates (and laws) that  have been enacted or substantially enacted by the balance sheet  date and are expected to apply when the related deferred income  tax asset is realised or the deferred income tax liability is settled. Deferred income tax assets are recognised to the extent that it is  probable that future taxable profit will be available against which  the temporary differences can be utilised.