FRONTKEN CORPORATION BERHAD 200401012517 (651020-T) ANNUAL REPORT 2024 70 NOTES TO THE FINANCIAL STATEMENTS (CONT’D) 2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS (CONT’D) 2.2 The Group and the Company have not applied in advance the following accounting standards and/or interpretations (including the consequential amendments, if any) that have been issued by the Malaysian Accounting Standards Board (“MASB”) but are not yet effective for the current nancial year (Cont’d): MFRSs and/or IC Interpretations (Including The Consequential Amendments) Effective Date Amendments to MFRS 9 and MFRS 7: Contracts Referencing Nature-dependent Electricity 1 January 2026 Amendments to MFRS 10 and MFRS 128: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture Deferred Amendments to MFRS 121: Lack of Exchangeability 1 January 2025 Annual Improvements to MFRS Accounting Standards – Volume 11 1 January 2026 The adoption of the above accounting standards and/or interpretations (including the consequential amendments, if any) is expected to have no material impact on the nancial statements of the Group and of the Company upon their initial application except as follows: MFRS 18 ‘Presentation and Disclosure in Financial Statements’ will replace MFRS 101 ‘Presentation of Financial Statements’ upon its adoption. This new standard aims to enhance the transparency and comparability of nancial information by introducing new disclosure requirements. Speci cally, it requires that income and expenses be classi ed into 3 de ned categories: “operating”, “investing” and “ nancing” and introduces 2 new subtotals: “operating pro t or loss” and “pro t or loss before nancing and income tax”. In addition, MFRS 18 requires the disclosure of management-de ned performance measures and sets out principles for the aggregation and disaggregation of information, which will apply to all primary nancial statements and the accompanying notes. The statements of nancial position and the statements of cash ows will also be affected. The potential impact of the new standard on the nancial statements of the Group and of the Company has yet to be assessed. 3. MATERIAL ACCOUNTING POLICY INFORMATION Critical Accounting Estimates And Judgements Key Sources of Estimation Uncertainty Management believes that there are no key assumptions made concerning the future, and other key sources of estimation uncertainty at the reporting date, that have a signi cant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next nancial year other than as disclosed below: (i) Impairment of Goodwill on Consolidation The assessment of whether goodwill is impaired requires an estimation of the value in use of the cashgenerating unit to which the goodwill is allocated. Estimating a value-in-use amount requires management to make an estimate of the expected future cash ows from the cash-generating unit and also to choose a suitable discount rate in order to calculate the present value of those cash ows. The carrying amount of goodwill on consolidation as at the reporting date and the key assumptions are disclosed in Note 15 to the nancial statements. (ii) Impairment of Property, Plant and Equipment and Right-Of-Use Assets The Group and the Company determine whether an item of its property, plant and equipment and right-ofuse assets is impaired by evaluating the extent to which the recoverable amount of the asset is less than its carrying amount. This evaluation is subject to changes such as market performance, economic and political situation of the country. A variety of methods is used to determine the recoverable amount, such as valuation reports and discounted cash ows. The carrying amounts of property, plant and equipment and right-of-use assets as at the reporting date are disclosed in Notes 11 and 12 to the nancial statements respectively.
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