2. ACCOUNTING POLICIES (CONTD.) 2.4 SUMMARY OF MATERIAL ACCOUNTING POLICIES (CONTD.) (e) Land held for property development and property development costs (i) Land held for property development Inventory properties where no development activities have been carried out or where development activities are not expected to be completed within the normal operating cycle are referred to as land held for development and classified within non-current assets. Generally no significant development work would have been undertaken on these lands other than infrastructure work, earth work and landscape work incurred to prepare the land for development and these inventory properties are stated at cost plus incidental expenditure incurred to put the land in a condition ready for development. These inventory properties are classified to current assets at the point when active development project activities have commenced and when it can be demonstrated that the development activities can be completed within the normal operating cycle. (ii) Property development costs Property development costs are recognised to the extent that the Group has performed the construction services. Property development costs are initially measured at cost, which is represented by the allocated fair value of the construction services rendered. (f) Impairment of non-financial assets The Group and the Company assess at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when an annual impairment assessment for an asset is required, the Group and the Company make an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s fair value less costs to sell and its value-in-use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows cash-generating unit (“CGU”). (g) Inventories Inventories are stated at lower of cost and net realisable value. Cost of consumables which is determined on the weighted average basis, comprise cost of purchase of inventories. Cost of property held for resale is determined on the specific identification basis and include cost associated with the acquisition of land, direct costs and appropriate proportions of common costs. (h) Financial instruments (i) Financial assets Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other comprehensive income (“OCI”), and fair value through profit or loss. For purposes of subsequent measurement, the Group and the Company have classified its financial assets into two categories: Financial assets at amortised cost (debt instruments) The Group’s and the Company’s financial assets at amortised cost includes trade and other receivables, and cash, bank balances and deposits. Notes to the Financial Statements For the year ended 31 December 2024 UEM EDGENTA BERHAD 290 Integrated Annual Report 2024
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