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Notes to the financial statements
31 December 2014
Bursa Malaysia
•
Annual Report 2014
113
2. Significant accounting policies (cont’d.)
2.4 Summary of significant accounting policies (cont’d.)
(o) Leases (cont’d.)
(ii) The Group and the Company as lessor
Leases where the Group and the Company retain substantially all the risks and rewards of ownership of the assets are classified as operating
leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over
the lease term on the same basis as rental income. The accounting policy for rental income is set out in Note 2.4(m)(x).
(p) Borrowing costs
Borrowing costs are recognised in profit or loss in the period they are incurred. Borrowing costs consist of interest and other costs that the Group and
the Company incurred in connection with the borrowing of funds.
(q) Income taxes
(i) Current tax
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the tax authorities. The tax rates and tax
laws used to compute the amount are those that are enacted or substantively enacted by the financial year end.
Current taxes are recognised in profit or loss except to the extent that the tax relates to items recognised outside profit or loss, either in other
comprehensive income or directly in equity.
(ii) Deferred tax
Deferred tax is provided using the liability method on temporary differences at the financial year end between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all taxable temporary differences, except for the deferred tax liability that arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss.
Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits, to the extent that it is
probable that taxable profit will be available against which the deductible temporary differences, unused tax losses and unused tax credits can
be utilised except where the deferred tax asset arises from the initial recognition of an asset or liability in a transaction that, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss.
The carrying amount of deferred tax assets are reviewed at each financial year end and reduced to the extent that it is no longer probable that
sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilised.
Unrecognised deferred tax assets are reassessed at each financial year end and are recognised to the extent that it has become probable that
future taxable profit will allow the deferred tax assets to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability
is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the financial year end.