1. Basis of preparation
(continued)
(a) Statement of compliance
(continued)
(ii) MFRS 15, Revenue from Contracts with Customers
MFRS 15 replaces the guidance in MFRS 111,
Construction Contracts
, MFRS 118,
Revenue,
IC Interpretation 13,
Customer Loyalty Programmes
, IC Interpretation 15,
Agreements for Construction of Real Estate
, IC Interpretation 18,
Transfers of Assets from
Customers
and IC Interpretation 131,
Revenue - Barter Transactions Involving Advertising
Services.
The Group is currently assessing the financial impact that may arise from the adoption
of MFRS 15.
(iii) MFRS 9, Financial Instruments
MFRS 9 replaces the guidance in FRS 139,
Financial Instruments: Recognition and
Measurement
on the classification and measurement of financial assets and financial
liabilities
The adoption of MFRS 9 will result in a change in accounting policy. The Group is currently
assessing the financial impact that may arise from the adoption of MFRS 9.
(b) Basis of measurement
The financial statements have been prepared on the historical cost basis, other than as
disclosed in Note 2.
(c) Functional and presentation currency
These financial statements are presented in Ringgit Malaysia (“RM”), which is the Company’s
functional currency. All financial information is presented in RM, unless otherwise stated.
(d) Use of estimates and judgements
The preparation of financial statements in conformity with FRSs requires management to make
judgements, estimates and assumptions that affect the application of accounting policies and
the reported amounts of assets, liabilities, income and expenses. Actual results may differ
from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimates are revised and in any future
periods affected.
There are no significant areas of estimation uncertainty and critical judgements in applying
accounting policies that have a significant effect on the amounts recognised in the financial
statements other than impairment assessment of property, plant and equipment and plantation
development expenditure as disclosed in Note 3 and Note 4 respectively. In preparing the
financial statements, the Group has evaluated whether these assets are stated in excess of their
net recoverable amounts. The net recoverable amounts are determined either by calculating
the value-in-use of the assets via estimating the cash flows from their continuing use and
discounting them to their net present values or by estimating their fair value less costs of
disposal, an exercise that entails a high degree of estimation uncertainty. An allowance for
impairment loss is made if the net recoverable amounts of the assets are lower than their
carrying amounts.
Notes to the Financial Statements
SARAWAK PLANTATION BERHAD
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Annual Report 2014
