59
FRONTKEN CORPORATION BERHAD
(651020-T)
ANNUAL REPORT 2014
NOTES TO THE
FINANCIAL STATEMENTS
(cont’d)
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
Assets Held For Sale
Assets that are expected to be recovered primarily through sale rather than through continuing use are
classified as held for sale. Upon classification as held for sale, assets or components of a disposal group are
not depreciated and are measured at the lower of their carrying amount and fair value less cost to sell. Any
differences are recognised in profit or loss.
Operating Segments
Operating segment is a component of the Group that engages in business activities from which it may earn
revenues and incur expenses, including revenues and expenses that relate to transactions with any of the
Group’s other components. An operating segment’s operating results are reviewed regularly by the chief
operating decision maker to make decisions about resources to be allocated to the segment and assess its
performance, and for which discrete financial information is available.
Revenue Recognition
(i)
Services
Revenue is recognised upon the rendering of services and when the outcome of the transaction can be
estimated reliably. In the event the outcome of the transaction could not be estimated reliably, revenue
is recognised to the extent of the expenses incurred that are recoverable.
(ii)
Sale of goods
Revenue is recognised upon delivery of goods and customers’ acceptance and where applicable, net
of returns and trade discounts.
(iii) Contracts
Revenue relating to contracts are accounted for under the percentage-of- completion method.
(iv) Management fee
Management fee is recognised on an accrual basis.
(v)
Interest income
Interest income is recognised on an accrual basis using the effect interest method.
(vi) Dividend income
Dividend income from investment is recognised when the right to receive dividend payment is established.
Income Taxes
Income tax for the year comprises current and deferred tax.
Current tax is the expected amount of income taxes payable in respect of the taxable profit for the reporting
period and is measured using the tax rates that have been enacted or substantively enacted at the end of
the reporting period.
Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the financial statements.
