Wah Seong Corporation Berhad Annual Report 2017

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2017 FINANCIAL STATEMENTS WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017 105 2 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 2.23 Revenue recognition (continued) (a) Construction contracts (continued) Progress billings not yet paid by customers and retentions by customers are included within ‘trade and other receivables’. (b) Sale of goods Revenue from sale of goods is measured at the fair value of the consideration receivable and is recognised in the profit or loss when the significant risks and rewards of ownership have been transferred to the buyer. (c) Service income Service income is recognised on an accrual basis when services have been rendered. (d) Dividend income Dividend income is recognised when the right to receive payment is established. (e) Rental income Rental income is recognised on a time proportion basis over the lease term. (f) Finance income on lease receivables Finance income on lease receivables is recognised according to the effective interest rate method so as to provide constant periodic rate of return on the net investment. (g) Interest income Interest income is recognised on a time proportion basis, taking into account the principal outstanding and the effective interest rate applicable. (h) Management fee Management fee is recognised on an accrual basis when service is rendered. (i) Hire of machinery and equipment Income from hire of machinery and equipment is recognised on a time proportion basis over the term of hire. (j) Commission income Commission income is recognised on an accrual basis when service is rendered.