b'FORGING TRANSFORMATION. FOSTERING SUSTAINABILITY. NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30th June 2017(Expressed in Trinidad and Tobago Dollars)4.Summary of significant accounting policies (continued)a.Basis of preparation (continued)These special purpose financial statements are the parent company unconsolidated financial statements of the NIBTT. NIBTT does not prepare consolidated financial statements. Further, these special purpose financial statements are prepared on the historical cost basis, except for the following items in the statement of financial position:Financial assets at fair value through profit or loss are measured at fair value;Investment properties are measured at fair value;Investments in subsidiary companies are measured at fair value;Artwork and freehold properties classified as property, plant and equipment are measured atfair value;The defined benefit asset/liability is recognised as plan assets, plus unrecognised past service cost, less the present value of the defined benefit obligation and based on actuarial valuations.The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses.The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.Information about critical estimates in applying accounting policies that have the most significant effect on the amounts recognised in the audited special purpose financial statements is included in Note 4n.b.Investments in subsidiary companiesSubsidiaries are all entities over which the NIBTT has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. These are as follows:CompaniesPercentage Ownership20182017National Insurance Property Development Company Limited (NIPDEC)100%100%Trinidad and Tobago MortgageFinance Company Limited (TTMF)51%51%Home Mortgage Bank (HMB)100%100%Investments in subsidiaries are initially recorded at cost and adjusted to fair market value based on valuations conducted by an independent professional valuator. Gains and/or losses arising from the change in fair value are included in the statement of comprehensive income.Investments in subsidiaries are valued by an independent valuator and are based on the assumption that they will continue to operate as going concerns and that the principal activities and legal structure of the companies will remain unchanged.41'