b'A N N U A L R E P O R T 2 0 1 7 - 2 0 1 8NOTES TO THE SPECIAL PURPOSE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2018(Expressed in Trinidad and Tobago Dollars)4.Summary of significant accounting policies (continued)c.Foreign currencyi.Functional and presentation currencyItems included in these special purpose financial statements are measured using the currency of the primary economic environment in which the entity operates (the functional currency). These special purpose financial statements are presented in Trinidad and Tobago dollars, which is NIBTTs functional and presentation currency, unless otherwise stated.ii.Foreign currencyTransactions in foreign currencies are initially recorded at the exchange rates ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are expressed in Trinidad and Tobago dollars at the rate of exchange ruling on the reporting date as obtained from the Central Bank of Trinidad and Tobago. All differences arising are taken to the statement of comprehensive income. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions.Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.d.Cash and cash equivalentsCash and cash equivalents, for the purpose of the statement of cash flows, represent cash and bank balances and highly liquid investments with a maturity period of three months or less.e.Financial assetsNIBTTs financial assets and financial liabilities are recognised in the statement of financial position when it becomes party to the contractual obligation of the instrument. A financial asset is derecognised when the right to receive the cash flows from the asset has expired or where NIBTT has transferred all the risks and rewards of ownership of the asset. A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires. All regular way purchases and sales are recognised at settlement date.i.Financial assets at fair value through profit or lossFinancial assets at fair value through profit or loss are subsequently carried at fair value based on quoted prices for investments traded in active markets; or valuation techniques, including recent arms length transactions, discounted cash flows analysis and other valuation techniques commonly used by market participants, for investments not traded in active markets. Where discounted cash flow techniques are used, estimated future cash flows are based on managements best estimates and the discount rate is a market-related rate at the reporting date for an instrument with similar terms and conditions. Held-for-trading securities are initially recognised at cost and subsequently remeasured at fair value based on quoted bid prices at the reporting date. Where the instrument is not actively traded or quoted on an active market, fair value is determined using discounted cash flow analysis. Gains and losses arising from sales and changes in fair values of these financial assets are recognised in the statement of comprehensive income in the period in which they arise.All related unrealised gains and losses are included in the statement of comprehensive income. Interest earned is reported as interest income.42'