Frontken Berhad Annual Report 2019

95 Frontken Corporation Berhad (651020-T) ANNUAL REPORT 2019 12. RIGHT-OF-USE ASSETS (CONT’D) Carrying Amount As at 1 January 2019/ Initial As at application of Depreciation 31 December MFRS 16 charges 2019 The Company RM RM RM Building 189,912 (94,956) 94,956 Accumulated Carrying Cost depreciation amount The Company RM RM RM Building 189,912 (94,956) 94,956 The comparative information is not presented as the Group and the Company have applied MFRS 16 using the modified retrospective approach. (a) The details of the Group’s lease assets under hire purchase arrangements are analysed as follows:- Carrying Amount 2019 RM Plant and machinery 487,324 Motor vehicles 213,778 Factory renovation 1,842,132 2,543,234 Effective interest rates 2.80% - 5.28% Remaining lease terms 1 – 2 years (b) The leasing activities of the remaining lease assets are summarised below:- (i) Leasehold land The Group has entered into 5 non-cancellable operating lease agreements for the use of land. The leases are for a period ranging from 30 to 60 years. The leases do not allow the Group to assign, transfer or sublease or create any charge, lien or trust in respect of or dispose of the whole or any part of the land. A tenancy is, however, allowed with the consent of the lessor. (ii) Factories and buildings and motor vehicles The Group has leased a number of factories and buildings, and motor vehicles that run between 1 to 5 years, with an option to renew the lease after that date. The Company has leased a building for 2 years, with an option to renew the lease after that date. Notes To The Financial Statements (cont’d)