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 2021
Assets
Cash and cash equivalents	2 256	–	2 256
Trade and other receivables	11 199	–	11 199
Non-current loan to associates	394	–	394
Non-current financial assets	436	26	462
Total financial assets	14 285	26	14 311

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	2021	2020
Liabilities at amortized costs
Trade and other payables	11 717	10 554
Loans, interest payables and legal liabilities	42 638	42 338
Lease liabilities	1 802	2 350
Total financial liabilities	56 157	55 242

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 2021	Level 1	Level 2	Level 3
Non-current financial assets	26	–	–	26
Biological assets	14 356	–	–	14 356
Land	42 332	–	42 332	–
Total assets measured at fair value	56 714	–	42 332	14 382

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

Reconciliation of fair value measurement of level 3 assets

in thousand EUR	2021	2020
At 1 January	10 187	13 183
Gain from changes in fair value from biological assets	4 074	927
Currency effects	121	–3 923
At 31 December	14 382	10 187