EXCEL FORCE MSC BERHAD Annual Report 2019

EXCEL FORCE MSC BERHAD - ANNUAL REPORT 2019 60 notes to the financial statements 31 december 2019 (cont’d) 2. Basis of Preparation (Cont’d) (a) Statement of compliance (Cont’d) Adoption of new and amended standards (Cont’d) MFRS 16 Leases (Cont’d) The following table explains the difference between operating lease commitments disclosed applying MFRS 117 at 31 December 2018, and lease liabilities recognised in the statements of financial position at 1 January 2019. Group and Company RM Operating lease commitments as at 31 December 2018 754,069 Discounted using the incremental borrowings rate at 1 January 2019 (25,683) Lease liabilities recognised as at 1 January 2019 728,386 The weighted average incremental borrowing rate applied to lease liabilities on 1 January 2019 was 3.5%. Standards issued but not yet effective The Group and the Company have not applied the following new standards and amendments to standards that have been issued by MASB but are not yet effective for the Group and for the Company: Effective dates for financial periods beginning on or after Amendments to References to the Conceptual Framework in MFRS Standards 1 January 2020 Amendments to MFRS 3 Definition of a Business 1 January 2020 Amendments to MFRS 9, MFRS 139 and MFRS 7 Interest Rate Benchmark Reform 1 January 2020 Amendments to MFRS 101 and MFRS 108 Definition of Material 1 January 2020 MFRS 17 Insurance Contracts 1 January 2021 Amendments to MFRS 101 Classification of Liabilities as Current or Non-current 1 January 2022 Amendments to MFRS 10 and MFRS 128 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture Deferred until further notice The Group and the Company intend to adopt the above new standards and amendments to standards when they become effective. The initial application of the above-mentioned new standards and amendments to standards are not expected to have any significant impacts on the financial statements of the Group and of the Company. (b) Functional and presentation currency These financial statements are presented in Ringgit Malaysia (“RM”), which is the Company’s functional currency. All financial information is presented in RM and has been rounded to the nearest RM except when otherwise stated.