NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 MARCH 2023 (CONT’D) 4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) 4.9 LEASES (CONT’D) The lease liability is subsequently measured at amortised cost using the effective interest method. It is remeasured when there is a change in the future lease payments (other than lease modification that is not accounted for as a separate lease) with the corresponding adjustment is made to the carrying amount of the right-of-use asset or is recognised in profit or loss if the carrying amount has been reduced to zero. 4.10 INVENTORIES Inventories are stated at the lower of cost and net realisable value. Cost and net realisable value are determined as below: (a) Properties Held for Future Development Property held for future development is stated at the lower of cost and net realisable value. The cost comprises specifically identified cost, including cost associated to the purchase of land and an appropriate proportion of common infrastructure costs. Net realisable value represents the estimated selling price of intended properties that to be developed less the estimated costs of completion and the estimated costs necessary in selling the properties. If future development layout plan is not available, the replacement cost of the properties held for future development will be the best available measure of the net realisable value. Properties held for future development for which no significant development work has been undertaken or where development activities are not expected to be completed within the normal operation cycle is classified as non-current asset. Properties held for future development is transferred to ‘properties under development for sale’ category when development activities have commenced and are expected to be completed within the Group’s normal operating cycle. (b) Properties Under Development for Sale Property under development for sale is stated at the lower of cost and net realisable value. The cost comprises specifically identified cost, including cost associated to the purchase of land, conversion fees, aggregate cost of development, materials and supplies, wages and other direct expenses, an appropriate proportion of common infrastructure costs and cost of constructing affordable houses less cumulative amounts recognised as expenses in profit or loss. Net realisable value represents the estimated selling price less the estimated costs of completion and the estimated costs necessary in selling the property. INTEGRATED ANNUAL REPORT 2023 MATRIX CONCEPTS HOLDINGS BERHAD 164 FINANCIAL STATEMENTS
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