Kimlun Corporation Berhad Annual Report 2019

Annual Report 2019 Kimlun Corporation Berhad NOTES TO THE FINANCIAL STATEMENTS For the financial year ended 31 December 2019 (cont’d) 82 2. Summary of significant accounting policies (cont'd) 2.2 Changes in accounting policies (cont'd) MFRS 16 Leases As at As at Effect of 1 January 1 January adopting 2019 Group 2019 MFRS 16 (Adjusted) Note RM RM RM Statement of financial position Non-current assets Right-of-use assets (a) - 9,644,016 9,644,016 Current liabilities Lease liabilities (b) - 3,477,802 3,477,802 Non-current liabilities Lease liabilities (b) - 6,350,857 6,350,857 Equity attributable to owners of the Company Retained earnings (c) 393,167,396 (184,643) 392,982,753 The adoption of the above Standards, Amendments, Annual Improvements and IC Interpretations did not have any significant impact on the financial statements other than the below: MFRS 16 supersedes MFRS 117: Leases, IC Interpretation 4: Determining whether an Arrangement contains a Lease, IC Interpretation 115: Operating Lease-Incentives and IC Interpretation 127: Evaluating the Substance of Transactions Involving the Legal Form of a Lease. The standard sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to recognise most leases on the balance sheet. The Group and the Company adopted MFRS 16 using the modified retrospective method of adoption with the date of application of 1 January 2019. Under this method, comparative figures are not restated and the cumulative effect of initially applying the standard is recognised as an adjustment to the opening balance of retained earnings as at the date of initial application. Lessor accounting under MFRS 16 is substantially unchanged from MFRS 117. Lessors will continue to classify leases as either operating or finance leases using similar principles as in MFRS 117. Therefore, MFRS 16 did not have an impact for leases where the Group and the Company is the lessor. The following table presents the impact to the statement of financial position of the Group resulting from the adoption of MFRS 16 Leases as at 1 January 2019: