2. Significant accounting policies
(continued)
b) Financial instruments
(continued)
(iv) Regular way purchase or sale of financial assets
A regular way purchase or sale is a purchase or sale of a financial asset under a contract
whose terms require delivery of the asset within the time frame established generally
by regulation or convention in the marketplace concerned.
A regular way purchase or sale of financial assets is recognised and derecognised, as
applicable, using trade date accounting. Trade date accounting refers to:
(a) the recognition of an asset to be received and the liability to pay for it on the trade
date, and
(b) derecognition of an asset that is sold, recognition of any gain or loss on disposal and
the recognition of a receivable from the buyer for payment on the trade date.
(v) Derecognition
A financial asset or a part thereof is derecognised when, and only when the contractual
rights to the cash flows from the financial asset expire or the financial asset is transferred to
another party without retaining control or substantially all risks and rewards of the asset.
On derecognition of a financial asset, the difference between the carrying amount and the
sum of the consideration received (including any new asset obtained less any new liability
assumed) and any cumulative gain or loss that had been recognised in equity is recognised
in the profit or loss.
A financial liability or a part thereof is derecognised when, and only when, the obligation
specified in the contract is discharged or cancelled or expires. On derecognition of a financial
liability, the difference between the carrying amount of the financial liability extinguished
or transferred to another party and the consideration paid, including any non-cash assets
transferred or liabilities assumed, is recognised in the profit or loss.
(c) Property, plant and equipment
(i) Recognition and measurement
Items of property, plant and equipment are stated at cost less any accumulated depreciation
and any accumulated impairment losses.
Cost includes expenditures that are directly attributable to the acquisition of the assets and
any other costs directly attributable to bringing the assets to working condition for its
intended use, and the costs of dismantling and removing the items and restoring the site
on which they are located. The cost of self-constructed assets also includes the cost of
materials and direct labour. For qualifying assets, borrowing costs are capitalised in
accordance with the accounting policy on borrowing costs. Cost also may include transfers
from equity of any gain or loss on qualifying cash flow hedges of foreign currency
purchases of property, plant and equipment.
Purchased software that is integral to the functionality of the related equipment is
capitalised as part of that equipment.
When significant parts of an item of property, plant and equipment have different useful
lives, they are accounted for as separate items (major components) of property, plant
and equipment.
Notes to the Financial Statements
SARAWAK PLANTATION BERHAD
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Annual Report 2014
