4) SIGNIFICANT ACCOUNTING POLICIES
(Cont’d)
k) Impairment of Non-Financial Assets
At the end of each reporting period, the Group reviews the carrying amounts of its non-
current assets to determine whether there is any indication that those assets have suffered
an impairment loss. If any such indication exists, the recoverable amount of the asset is
estimated in order to determine the extent of the impairment loss (if any). Where it is not
possible to estimate the recoverable amount of an individual asset, the Group estimates
the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value-in-use. In
assessing value-in-use, the estimated future cash flows are discounted to their present
values using a pre-tax discount rate that reflects current market assessments of the time
value of money and the risk specific to the asset. If the recoverable amount of an asset (or
cash-generating unit) is estimated to be less than its carrying amount, the carrying amount
of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment
loss is recognised immediately in profit or loss unless the asset is carried at a revalued
amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to
the extent of any unutilised previously recognised revaluation surplus for the same asset.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or
cash-generating unit) is increased to the revised estimate of its recoverable amount, but
so that the increased carrying amount does not exceed the carrying amount that would
have been determined had no impairment loss been recognised for the asset (or cash-
generating unit) in prior years. A reversal of an impairment loss is recognised immediately
in profit or loss.
l)
Hire Purchase Arrangement
Assets held under hire purchase are treated as if they had been purchased at cost at
the commencement of the hire purchase agreements. These costs are included under
property, plant and equipment and depreciation is provided accordingly. The corresponding
obligations under hire purchase are included under liabilities. The charges of instalments
payable are charged to profit or loss over the period of the hire purchase agreements.
m) Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive)
as a result of a past event, it is probable that an outflow of economic resources will be
required to settle the obligation and the amount of the obligation can be estimated reliably.
Provisions are reviewed at each reporting date and adjusted to reflect the current best
estimate. If it is no longer probable that an outflow of economic resources will be required
to settle the obligation, the provision is reversed. If the effect of the time value of money
is material, provisions are discounted using a current pre tax rate that reflects, where
appropriate, the risks specific to the liability. When discounting is used, the increase in the
provision due to the passage of time is recognised as a finance cost.
Asia Media Group Berhad Annual Report 2014
96
NOTES TO THE FINANCIAL STATEMENTS
(Cont’d)
