f) NSFAS determines the fair value of the loans receivables at initial recognition by applying a reasonable and reliable valuation technique. It may be appropriate to discount the expected future cash flows, in respect of the instrument, using a rate that the market would price these loans at. g) Loans issued are recognised upon initial recognition at a significantly lower fair value amount than the cash actually issued with the difference being recognised in profit or loss. The loss on initial recognition is effectively a cost of delivering on the NSFAS's mandate and this cost is not recognised as and when the expenditure occurs as this would misrepresent the financial performance of the entity.