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FRONTKEN CORPORATION BERHAD
(651020-T)
ANNUAL REPORT
2015
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
Financial Instruments (Cont’d)
(i)
Financial assets (Cont’d)
· Loans and receivables financial assets
Trade receivables and other receivables that have fixed or determinable payments that are not quoted in an
active market are classified as loans and receivables financial assets. Loans and receivables financial assets
are measured at amortised cost using the effective interest method, less any impairment loss. Interest income
is recognised by applying the effective interest rate, except for short-term receivables when the recognition of
interest would be immaterial.
Loans and receivables financial assets are classified as current assets, except for those having settlement dates
later than 12 months after the reporting date which are classified as non-current assets.
· Available-for-sale financial assets
As at the end of the reporting period, there were no financial assets classified under this category.
(ii) Financial liabilities
All financial liabilities are initially measured at fair value plus directly attributable transaction costs and subsequently
measured at amortised cost using the effective interest method other than those categorised as fair value through
profit or loss.
Fair value through profit or loss category comprises financial liabilities that are either held for trading or are
designated to eliminate or significantly reduce a measurement or recognition inconsistency that would otherwise
arise. Derivatives are also classified as held for trading unless they are designated as hedges. Fair value through
profit or loss category also comprises contingent consideration in a business combination.
Financial liabilities are classified as current liabilities unless the Group has an unconditional right to defer settlement
of the liability for at least 12 months after the reporting date.
(iii) Equity instruments
Equity instruments classified as equity are measured at cost and are not remeasured subsequently.
· Ordinary shares
Incremental costs directly attributable to the issue of new ordinary shares are shown in equity as a deduction,
net of tax, from proceeds.
Dividends on ordinary shares are recognised as liabilities when approved for appropriation.
· Treasury Shares
When the Company’s own shares recognised as equity are bought back, the amount of the consideration paid,
including all costs directly attributable, are recognised as a deduction from equity. Own shares purchased that
are not subsequently cancelled are classified as treasury shares and are presented as a deduction from total
equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of treasury
shares.
Where treasury shares are sold, the difference between the sales consideration and the carrying amount of the
treasury shares are shown as a movement in equity. When the consideration received is more than the carrying
amount, the credit difference arising is taken to the share premium account. Where the consideration received
is less than the carrying amount, the debit difference is offset against reserves.
NOTES TO THE FINANCIAL STATEMENTS
(cont’d)