EXCEL FORCE MSC BERHAD Annual Report 2018

59 ANNUAL REPORT 2018 2. Basis of Preparation (cont’d) (a) Statement of compliance (cont’d) Adoption of new and amended standards (cont’d) (ii) MFRS 15 Revenue from Contracts with Customers MFRS 15 establishes a five-step model that will apply to recognition of revenue arising from contracts with customers, and provide a more structured approach in measuring and recognising revenue. Revenue is recognised when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the good or service. The core principle in MFRS 15 is that an entity recognises revenue to depict the transfer of promised goods or services to the customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Group and the Company adopted MFRS 15 using the modified retrospective method of adoption with the date of initial application of 1 January 2018. Under this method, MFRS 15 can be applied either to all contracts at the date of initial application or only to contracts that are not completed at this date. The adoption of MFRS 15 has no material financial impact other than the disclosures made in the financial statements. There is no significant impact arising from adoption of MFRS 9 and MFRS 15 on the Group’s and the Company’s financial statements except as follows: Statements of Financial Position As at MFRS 9 MFRS 15 As at 31.12.2017 adjustments adjustments 1.1.2018 RM RM RM RM Group Current asset Trade receivables 3,150,120 (65,044) - 3,085,076 Current liabilities Other payables 3,009,515 - (804,039) 2,205,476 Contract liabilities - - 804,039 804,039 3,009,515 - - 3,009,515 Equity Retained earnings 25,909,341 (65,044) - 25,844,297 Company Current asset Trade receivables 2,732,671 (45,881) - 2,686,790 Current liabilities Other payables 2,319,197 - (170,685) 2,148,512 Contract liabilities - - 170,685 170,685 2,319,197 - - 2,319,197 Equity Retained earnings 26,124,151 (45,881) - 26,078,270 Statements of profit or loss and other comprehensive income Group Net loss on impairment on financial instruments - (12,208) - (12,208) Other operating expenses (1,626,332) 12,208 - (1,614,124) * The comparatives have been reclassified to conform with current year presentation. Notes To The Financial Statements 31 December 2018 (cont’d) * * * * * *