Tropicana Corporation Berhad Annual Report 2019

For the financial year ended 31 December 2019 Notes to the Financial Statements 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) 2.12 Contract cost assets (cont’d.) (b) Costs to fulfill a contract The costs incurred in ful lling a contract with a customer who are not within the scope of other MFRSs, such as MFRS 102: Inventories, MFRS 116: Property, Plant and Equipment and MFRS 138: Intangible Assets, are recognised as contract cost assets when all of the following criteria are met: - the costs relate directly to a contract or to an anticipated contract that can be speci cally identi ed; - the costs generate or enhance resources of the Group that will be used in satisfying (or in continuing to satisfy) performance obligations in the future; and - the costs are expected to be recovered. Contract cost assets are amortised on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the asset relates. The amortisation shall be updated subsequently to re ect any signi cant change to the expected timing of transfer to the customer of the goods or services to which the asset relates in accordance with MFRS 108: Accounting Policies, Changes in Accounting Estimates and Errors. Impairment loss is recognised in pro t or loss to the extent that the carrying amount of the contract cost exceeds: - the remaining amount of consideration that the Group expects to receive in exchange for the goods or services to which the asset relates; less - the costs that relate directly to providing those goods or services and that have not been recognised as expenses. Before an impairment loss is recognised for contract costs, the Group shall recognise any impairment loss for assets related to the contract that are recognised in accordance with other MFRSs, such as MFRS 102, MFRS 116 and MFRS 138. The Group shall include the resulting carrying amount of the contract costs assets in the carrying amount of the cash-generating unit to which it belongs for the purpose of applying MFRS 136: Impairment of Assets to that cash-generating unit. An impairment loss is reversed when the impairment conditions no longer exist or have improved. Such reversal is recognised in pro t or loss. 2.13 Intangible assets Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses. Internally generated intangibles, excluding capitalised development costs, are not capitalised and the related expenditure is reflected in profit or loss in the period in which the expenditure is incurred. The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in profit or loss in the expense category that is consistent with the function of the intangible assets. Tropicana Corporation Berhad Annual Report 2019 pg 142 About Tropicana Our Strategic Performance Our Leadership