Subsequent measurement of financial assets and financial liabilities  LO2, 3, 13, 15 The trainee accountant at Dragon Ltd is unsure how to measure a number of items included in its financial records and has asked for your advice. Identify whether each of the following is a financial asset or financial liability and explain on what basis it must be subsequently measured. 1. Trade receivables 2. Primary borrowings of $1 million carrying a variable interest rate 3. 5-year government bonds held paying interest of 5% p.a. 4. Investment in a long-term portfolio of shares listed on the ASX 5. Investment in a trading portfolio of shares listed on the ASX 6. Purchased loans held for short periods before being on-sold 7. Mandatorily converting notes held, paying coupon interest of 6% p.a. — the notes must convert to a variable number of ordinary shares at the expiration of their term 8. Mandatorily redeemable preference shares with a cumulative dividend rate of 6% p.a. — the preference shares must be redeemed for cash at their expiration in 5 years, held within a business model with the objective of collecting contractual cash flows 9. Call or put options held on shares in Telstra Corporation Limited 10. Call or put options written on shares in Telstra Corporation Limited 11. ASX SPI 200 Futures contract with a negative fair value 12. ASX SPI 200 Futures contract with a positive fair value