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Notes to the Financial Statements
31 December 2015
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(a) Basis of consolidation (continued)
(iii) Disposal of subsidiaries
When the Group ceases to consolidate because of a loss of control, any retained interest in the entity is re-measured to its fair value
with the change in carrying amount recognised in the statement of profit or loss. This fair value becomes the initial carrying amount
for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any
amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly
disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are
reclassified to the statement of profit or loss.
(b) Foreign currencies
(i)
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic
environment in which the entity operates (the “functional currency”). These financial statements are presented in Ringgit Malaysia
(“RM”), which is the Company’s functional and presentation currency.
When there is a change in an entity’s functional currency, the entity shall apply the translation procedures applicable to the new
functional currency prospectively from the date of the change.
(ii)
Transactions and balances
Transactions in foreign currencies are translated to the respective functional currencies of the Group entities using the exchange rates
prevailing at the date of the transactions.
Monetary assets and liabilities in foreign currencies at the reporting date are translated into the functional currency at exchange rates
ruling at the date.
Exchange differences arising from the settlement of foreign currency transactions and the translation of monetary assets and liabilities
denominated in foreign currencies at year end are recognised in the statement of profit or loss. However, exchange differences are
deferred in other comprehensive income when they arise from qualifying cash flow or net investment hedges or are attributable to
items that form part of the net investment in a foreign operation.
(iii) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have
a functional currency different from the presentation currency are translated into the presentation currency as follows:
• assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that
statement of financial position;
• income and expenses for each statement of profit or loss are translated at average exchange rates (unless this average is not
a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and
expenses are translated at the rate on the dates of the transactions); and
• all resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to shareholders’
equity. When a foreign operation is disposed of, exchange differences that were recorded in equity are reclassified to the statement
of profit or loss, as part of the gain or loss on sale.
