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88
GHL Systems Berhad
(293040-D)
Annual report 2015
Notes to the Financial Statements
31 December 2015 (continued)
4.
SIGNIFICANT ACCOUNTING POLICIES (continued)
4.18 Revenue recognition (continued)
(c) Interest income
Interest income is recognised as it accrues, using the effective interest method.
(d) Rental income
Rental income is accounted for on a straight line basis over the lease term of an ongoing lease.
The aggregate cost of incentives provided to the lessee is recognised as reduction of rental
income over the lease term on a straight line basis.
4.19 Operating segments
Operating segments are defined as components of the Group that:
(a) Engages in business activities from which it could earn revenues and incur expenses (including
revenues and expenses relating to transactions with other components of the Group);
(b) Whose operating results are regularly reviewed by the chief operating decision maker of the
Group in making decisions about resources to be allocated to the segment and assessing its
performance; and
(c) For which discrete financial information is available.
An operating segment may engage in business activities for which it has yet to earn revenues.
The Group reports separately information about each operating segment that meets any of the
following quantitative thresholds:
(a) Its reported revenue, including both sales to external customers and intersegment sales or
transfers, is ten percent (10%) or more of the combined revenue, internal and external, of
all operating segments.
(b) The absolute amount of its reported profit or loss is ten percent (10%) or more of the greater,
in absolute amount of:
(i) The combined reported profit of all operating segments that did not report a loss; and
(ii) The combined reported loss of all operating segments that reported a loss.
(c) Its assets are ten percent (10%) or more of the combined assets of all operating segments.
Operating segments that do not meet any of the quantitative thresholds may be considered
reportable, and separately disclosed, if the management believes that information about
the segment would be useful to users of the financial statements.
Total external revenue reported by operating segments shall constitute at least seventy-five
percent (75%) of the revenue of the Group. Operating segments identified as reportable
segments in the current financial year in accordance with the quantitative thresholds
would result in a restatement of prior period segment data for comparative purposes.