Sasbadi Annual Report 2019

PAGE 104 SASBADI HOLDINGS BERHAD FINANCIAL STATEMENTS (continued) 9. Inventories Group 2019 2018 RM’000 RM’000 At cost/net realisable value Raw materials 5,865 9,027 Finished goods 67,581 64,435 73,446 73,462 Recognised in profit or loss: Inventories recognised as cost of sales 23,945 22,460 Provision of inventories write-down, net 2,996 3,634 10. Right to recover returned goods/(Refund liabilities) Group 2019 2018 RM’000 RM’000 Right to recover returned goods 2,035 1,257 Refund liabilities (3,851) (2,349) During the current financial year, on adoption of MFRS 15, Revenue from Contracts with Customers , an asset with a right to recover returned goods and the corresponding refund liabilities are recognised in relation to finished goods sold with a right of return. These are measured by reference to the former carrying amounts of the sold inventories less any expected costs to recover those inventories and any potential decreases in the value to the Group of the returned inventories. 11. Contract with customers 11.1 Contract costs 2019 2018 Group RM’000 RM’000 Restated Cost to obtain a contract 381 1,032 Cost to obtain a contract primarily comprises commission fees paid to intermediaries as a result of obtaining contracts and they are recoverable. Capitalised commission fees are amortised when the related revenues are recognised. During the current financial year, the amount of amortisation was RM1,930,000 (2018: RM2,689,000).