27 EPRA ANNUAL REPORT 2018 (e) Financial instruments: Financial instruments are recorded at fair value on initial recognition. Equity instruments that are quoted in an active market are subsequently measured at fair value. All other financial instruments are subsequently recorded at cost or amortized cost, unless management has elected to carry the instruments at fair value. The Association has not elected to carry any such financial instruments at fair value. Transaction costs incurred on the acquisition of financial instruments measured subsequently at fair value are expensed as incurred. All other financial instruments are adjusted by transaction costs incurred on acquisition and financing costs, which are amortized using the straight-line method. Financial assets are assessed for impairment on an annual basis at the end of the fiscal year if there are indicators of impairment. If there is an indicator of impairment, the Association determines if there is a significant adverse change in the expected amount or timing of future cash flows from the financial asset. If there is a significant adverse change in the expected cash flows, the carrying value of the financial asset is reduced to the highest of the present value of the expected cash flows, the amount that could be realized from selling the financial asset 2018 2017 Accumulated Net book Net book Cost amortization value value Software $ 643,620 $ 499,167 $ 144,453 $ 103,465 Furniture and equipment 140,732 118,335 22,397 29,994 Equipment 13,050 6,960 6,090 8,700 Leasehold improvements 203,717 108,428 95,289 136,480 $ 1,001,119 $ 732,890 $ 268,229 $ 278,639 3. Capital assets or the amount the Association expects to realize by exercising its right to any collateral. If events and circumstances reverse in a future year, an impairment loss will be reversed to the extent of the improvement, not exceeding the initial carrying value. (f) Use of estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the year. Significant items subject to such estimates and assumptions include the allowance for doubtful accounts, accruals for processing end-of-life electronic products and environmental handling fees, accrued revenue and amortization of capital assets. Actual results could differ from those estimates. 2. Accounts receivable: Included in accounts receivable is an amount totaling $1,400,000 (2017 - $1,400,000) owing from the British Columbia administration service provider that was advanced in order to finance the region’s operations. The advance is unsecured, non-interest bearing and due on demand.