Tropicana Corporation Berhad Annual Report 2022

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D.) 2.30 Contingencies A contingent liability or asset is a possible obligation or asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of uncertain future event(s) not wholly within the control of the Group. C ontingent liabilities and assets are not recognised in the statements of financial position of the Group. 2.31 Fair value measurement T he Group and the Company measure financial instruments such as derivatives and non-financial assets such as investment properties, at fair value at each reporting date. The fair values of financial instruments measured at amortised cost are disclosed in Note 38. T he fair value of an asset or a liability, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement assumes that the transaction to sell the asset or transfer the liability takes place either in the principal market or in the absence of a principal market, in the most advantageous market. T he Group and the Company measure the fair value of an asset or a liability by taking into account the characteristics of the asset or liability if market participants would take these characteristics into account when pricing the asset or liability. The Group and the Company have considered the following characteristics when determining fair value: (a) T he condition and location of the assets; and (b) Restrictions, if any, on the sale or use of the assets. T he fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. T he fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The fair value of a nancial or non- nancial liability or an entity’s own equity instrument assumes that: (a) A liability would remain outstanding and the market participant transferee would be required to ful l the obligation. The liability would not be settled with the counterparty or otherwise extinguished on the measurement date; and (b) A n entity’s own equity instrument would remain outstanding and the market participant transferee would take on the rights and responsibilities associated with the instrument. The instrument would not be cancelled or otherwise extinguished on the measurement date. 191 FINANCIAL STATEMENTS & OTHER INFORMATION

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