The loan commitment made by X Inc is not a financial instrument, as it does not meet the definition of a financial instrument under IAS 32. It is merely an agreement to enter into a future transaction.

However, the change in the market interest rate will have an impact on the financial asset and liability that will arise when the loan is actually granted on 10 April 2018.

Effect on Financial Asset and Liability:

• Financial Asset (Loan Receivable): The loan receivable will have a carrying amount of $200 million, which is the present value of the loan discounted at 10% for 5 years. As of 31 March 2018, the fair value of the loan asset is $202.03 million, calculated using the market interest rate of 9.5% for 5 years.
• Financial Liability (Loan Payable): The loan payable will have a carrying amount of $200 million, which is the present value of the loan discounted at 10% for 5 years. As of 31 March 2018, the fair value of the loan liability is $197.98 million, calculated using the market interest rate of 9.5% for 5 years.

If X Inc has the practice of selling the loan asset resulting from the loan commitment shortly after the origination, it would recognize the loan asset and loan liability at fair value through profit or loss upon initial recognition. The difference between the fair value and the carrying amount would be recognized as a gain or loss in profit or loss.