20. Financial instruments by category and fair value hierarchy

Financial instruments by category

in thousand EUR	at amortized costs	at fair value through OCI	Total
31 December 2020
Assets
Cash and cash equivalents	2 778	–	2 778
Trade and other receivables	9 717	–	9 717
Non-current loan to associates	365		365
Non-current financial assets	–	25	25
Total financial assets	12 860	25	12 885

in thousand EUR	at amortized costs	at fair value through OCI	Total
31 December 2019
Assets
Cash and cash equivalents	2 578	–	2 578
Trade and other receivables	6 292	–	6 292
Non-current financial assets	–	25	25
Total financial assets	8 870	25	8 894

in thousand EUR	2020	2019
Liabilities at amortized costs
Trade and other payables	10 554	10 446
Loans, interest payables and legal liabilities	42 338	42 035
Lease liabilities	2 350	2 173
Total financial liabilities	55 242	54 654

Accounting policies

Financial assets are categorized as current assets if they are expected to be realized within 12 months from the reporting date otherwise they are included in non-current assets. Trade accounts receivables and other current assets are measured at amortized cost less allowances for expected credit losses. Financial assets at fair value through OCI are subsequently measured at fair value, with changes in fair value recorded in other comprehensive income.

Trade accounts payables and current liabilities are categorized as current liabilities if they are expected to be realized within 12 months from the reporting date otherwise they are included in non-current liabilities. They are measured at amortized cost. Borrowings are classified as current liabilities unless Precious Woods has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. They are initially recorded at fair value, net of transaction costs, and subsequently measured at amortized cost according to the effective interest rate method.

Cash and cash equivalents comprise cash at bank and in hand and short-term highly liquid deposits with an original maturity of three months or less. They are recorded at nominal value. Bank overdrafts are presented within current financial liabilities.

Fair value hierarchy

The carrying amounts of financial instruments correspond approximately to their fair value. The Group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1 – quoted (unadjusted) prices in active markets for identical assets or liabilities

Level 2 – other techniques for which all inputs that have a significant effect on the recorded fair value are observable, either directly or indirectly

Level 3 – techniques that use inputs, which have a significant effect on the recorded fair value, and which are not based on observable market data

Assets measured at fair value

in thousand EUR	31 December 2020	Level 1	Level 2	Level 3
Non-current financial assets	25	–	–	25
Biological assets	10 162	–	–	10 162
Land	42 178	–	42 178	–
Total assets measured at fair value	52 365	–	42 178	10 187

in thousand EUR	31 December 2019	Level 1	Level 2	Level 3
Non-current financial assets	25	–	–	25
Biological assets	13 158	–	–	13 158
Land	56 331	–	56 331	–
Total assets measured at fair value	69 514	–	56 331	13 183

Reconciliation of fair value measurement of level 3 financial assets

in thousand EUR	2020	2019
At 1 January	13 183	466
Reversal of impairment	–	576
Reclassification to assets held for sale	–	–1 024
Gain from changes in fair value from biological assets	927	13 158
Currency effects	–3 923	6
At 31 December	10 187	13 183