Sasbadi Annual Report 2020

SASBADI HOLDINGS BERHAD 140 FINANCIAL STATEMENTS (continued) 30. Significant changes in accounting policies (continued) Impact on financial statements Since the Group and the Company applied the requirements of MFRS 16 retrospectively with the cumulative effect of initial application at 1 September 2019, there are no adjustments made to the prior period presented. The following table explains the difference between operating lease commitments disclosed applying MFRS 117 at 31 August 2019, and lease liabilities recognised in the statement of financial position at 1 September 2019. Group RM’000 Operating lease commitments at 31 August 2019 as disclosed in the Group’s financial statements 1,734 Discounted using the incremental borrowing rate at 1 September 2019 1,602 Finance lease liabilities recognised at 31 August 2019 338 Recognition exemption for short-term leases (247) Extension options reasonably certain to be exercised 252 Lease liabilities recognised at 1 September 2019 1,945