Al-`Aqar Healthcare REIT Annual Report 2020

Financial Reports 117 2. Significant accounting policies (cont’d) 2.1 Basis of preparation (cont’d) The Manager believes that the Group will meet their short term obligation as and when they fall due on the basis that the Group will be able to refinance their borrowings when it matures. As at the reporting date, the Group received various proposals from financial institutions on the refinancing plan. As at the date of the financial statements, the Group is assessing the available options and will finalise the refinancing plan before the maturity date in May 2021. Taking into consideration the viability of these available options, the Group is confident in materialising its refinancing plan before the maturity date. Accordingly, the Manager is of the opinion going concern basis used in the preparation of financial statements is appropriate. 2.2 Changes in accounting policies The accounting policies adopted are consistent with those of the previous financial year, except in the current period, the Group and the Fund adopted the following new and amended MFRS mandatory for annual financial periods beginning on or after 1 January 2020: Effective for annual period beginning on Description or after Amendments to MFRS 9, MFRS 139 and MFRS 7: Interest Rate Benchmark Reform 1 January 2020 Amendments to MFRS 101: Definition of Material 1 January 2020 Amendments to MFRS 108: Definition of Material 1 January 2020 References to the Conceptual Framework in MFRS Standards 1 January 2020 Amendment to MFRS 16 Leases: COVID-19 Related Rent Concessions 1 June 2020 Amendments to MFRS 3 Business Combinations: Definition of a Business 1 January 2020 Amendments to MFRS 4 Insurance Contracts: Extension of the Temporary Exemption from Applying MFRS 9 17 August 2020 Amendments to MFRS 101: Classification of Liabilities as Current or Non-current - Deferral of Effective Date 17 August 2020 The adoption of the above new and amended MFRS did not have any significant financial impact to the Group and the Fund. 2.3 Standards and interpretations issued but not yet effective The standards and interpretations that are issued but not yet effective are disclosed below. The Group and the Fund intend to adopt these standards, if applicable, when they become effective. Effective for annual period beginning on Description or after Amendments to MFRS 3 Business Combinations: Reference to the Conceptual Framework 1 January 2022 Amendments to MFRS 116 Property, Plant and Equipment: Proceeds before Intended Use 1 January 2022 Amendments to MFRS 137 Provisions, Contingent Liabilities and Contingent Assets: Onerous Contracts − Cost of Fulfilling a Contract 1 January 2022 Annual Improvements to MFRS Standards 2018 − 2020 1 January 2022 Amendments to MFRS 101 Presentation of Financial Statements: Classification of Liabilities as Current or Non-current 1 January 2023 MFRS 17 Insurance Contracts 1 January 2023 Amendments to MFRS 17 Insurance Contracts 1 January 2023 Amendments to MFRS 10 and MFRS 128: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture Deferred Notes to the Financial Statements For the Year Ended 31 December 2020