ENRA Group Berhad Annual Report 2019

87 ENRA GROUP BERHAD ∞ Annual Report 2019 page Notes to the Financial Statement 31 March 2019 5. RIGHT-OF-USE ASSETS AND LEASE LIABILITIES (cont’d) (b) Lease liabilities (cont’d) (iv) The currency exposure profile of lease liabilities are as follows: Group Company 2019 RM’000 2018 RM’000 2019 RM’000 2018 RM’000 Ringgit Malaysia 1,711 2,164 896 1,316 US Dollar 84,274 - - - Australian Dollar 817 - 18 54 86,802 2,164 914 1,370 (v) The Group and the Company elected to apply exemption for the lease of buildings expiring within 12 months under the Appendix C, paragraph 10 (c) of this Standard and exemption for the lease of equipments which is low value under the Appendix C, paragraph 9 (a) of this Standard. The lease payments are recognised as an expense on a straight line basis over the remaining lease term during the current financial year. The lease payments recognised as an expense for the Group and the Company are amounted to RM197,000 and RM79,000 respectively (2018: RM112,000 and RM8,000). 6. INVESTMENT IN A JOINT VENTURE On 5 June 2017, ENRA Engineering & Construction Sdn. Bhd. (“EEC”), a wholly-owned subsidiary of the Company and Emrail Sdn. Bhd. had entered into a Shareholders Agreement to jointly establish a company to collaborate on providing total engineering solutions and services, civil works, rolling stock, project and asset management and maintenance services for rail and track transportation projects in Malaysia. Subsequently, ENRA Emrail Sdn. Bhd. (“EEM”) was established on 28 August 2017 with an issued and paid-up share capital of RM100 ordinary shares. EEC holds 51% of the shareholdings of EEM. Details of the joint venture is as follow: Name of company Effective interest in equity Principal activities 2019 % 2018 % ENRA Emrail Sdn. Bhd. 51 51 Intended business has yet to commence A joint venture is a contractual arrangement whereby two or more parties undertake an economic activity that is subject to joint control, where the strategic financial and operating decisions relating to the activity require the unanimous consent of the parties sharing control. Investment in a joint venture is accounted for in the consolidated financial statements using the equity method less any impairment losses. The consolidated financial statements include the Group’s share of the profit or loss and other comprehensive income of the equity accounted joint venture, after adjustments, if any, to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases. When the Group’s share of losses exceeds its interests in an equity accounted joint venture, the carrying amount of that interests including any long-term investments is reduced to zero, and the recognition of further losses is discontinued except to the extent that the Group has an obligation or has made payments on behalf of the investee.