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1.0INTRODUCTIONFinancial Reporting Standards (FRS) was first implement on 1 January 2006 and with

effect from that day all reporting entities in Malaysia are required to prepare their financial

statement in accordance with the adopted new and improved Financial Reporting Standards.

Financial Reporting Standard (FRS) is a standard required to be followed by all the listed

company in Malaysia when preparing the annual financial report to ensure that all the

information are being disclose in a suitable way and understandable by the public. To help

our capital markets have become globally, FRS has improved to equivalent to International

Financial Reporting Standard (IFRS) which will help to place Malaysian business on a level

playing field with its international counterparts.

Our analysis involved FRS 3 (Business Combination) which is FRS 117 Lease, FRS 136

Impairment of Assets, FRS 138 Intangible Assets, and FRS 140 Investment Property. We

have randomly selected 3 public companies (in the same industry) listed in Bursa Malaysia to

do analyze on their accounting treatment, especially in the presentation and disclosure part.

We have chosen Kretam Holdings Bhd, Sarawak Plantation Bhd, and Genting Plantations

Berhad to study the disclosure of FRS listed above and analyzes the compliance level of each

of the companies.

To calculate for the level of compliance, we will use this formula

level of compliance = number of ticks

number of item under frs less number of item unrelated to the company

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BACKGROUND OF COMPANY

Kretam Holdings Bhd

KRETAM HOLDING BERHAD (KHB) was listed on the Bursa Malaysia Main Board(Plantation Sector) on 18th January 1989.

The KHB Group is involved in investment holding, oil palm cultivation, milling and sale

of oil palm products, provision of plantation & palm oil mill management including services and

stock broking. KHB group head office is located at Sandakan town while the plantation division

being its core business is located at Sandakan & Tawau area.

Syarikat Kretam Mill Sdn Bhd, one of KHB's subsidiaries, owns and operates a palm oil mill at

Mile 44 Sandakan - Lahad Datu highway near Bukit Garam, Kinabatangan. We are planning to

construct a new palm oil mill at Sg. Silimpopon in Kalabakan, Tawau in 2010.

The Vision and Mission of Kretam Holdings Bhd is to become the best innovative, nature

friendly and Profitable Companys in this industry.

The career opportunity for this company is looking for suitably qualified candidates for the

positions in jobs.

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Sarawak Plantation (SPB)

Sarawak Plantation (SPB) was incorporated in Malaysia on 28 October 1997 as a private

limited company under the name of Sarawak Plantation Sdn. Bhd. and commenced business in

the same year. SPB was converted into a public company on 1 February 2000 and assumed its

present name. SPB was specially incorporated as the vehicle company for the privatization of

Sarawak Land Development Boards (SLDB) assets. SPB is the only oil palm seed producer in

Sarawak and it owns and operates a seed garden. Its current annual production is around 1.4

million seeds and it targets to produce 5 million high quality seeds by 2014. These high quality

seeds are certified by SIRIM and are licensed for sale by the Malaysian Palm Oil Board (MPOB).

Apart from providing seeds for internal use, SPB also sells its seeds to other plantations and

smallholders.

The core business activities of the SPB Group are:

Development, cultivation and management of oil palm plantations ona large scale

Milling of fresh fruit bunches (FFB) into crude palm oil (CPO) and palmkernel (PK).

Plantation management services. Strategic investment to develop NCR land into oil palm plantations. Operation of a seed garden supplying high yielding seeds and

seedlings.

Providing laboratory and technical services for the oil palm industry.

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Genting Plantations Berhad

Genting Plantations Berhad ("Genting Plantations"), formerly known as Asiatic

Development Berhad, is one of the fastest growing plantation companies listed on the Main

Board of Bursa Malaysia (formerly known as Kuala Lumpur Stock Exchange). Incorporated in

Malaysia as a private limited company on 29 September 1977, under the name of Asiatic

Development Sdn Bhd, it became a wholly owned subsidiary ofGenting Berhad ("Genting") on

22 February 1980 to spearhead Genting's plantation business.

Genting Plantations currently has about 133,000 hectares of plantation land (compared to

41,000 hectares in 2000) in Malaysia and Indonesia. Since its inception, Genting Plantations has

established itself as a reputable and reliable palm oil producer as well as one of the lowest-cost

palm oil producers in Malaysia. Whilst the plantation business remains its core activity, Genting

Plantations has also ventured into property development. The first project by Genting

Plantations's property arm, Genting Property Sdn Bhd is the 55-hectare Genting Cheng Perdana

in Central Melaka, which is near the tail-end of development.

Its second project is the 284-hectare Genting Permaipura in Kedah. Located in the

northern part of Malaysia near the town of Sungei Petani, this comprehensive township offers amix of commercial properties, bungalow lots, residential houses and an 18-hole golf course with

a clubhouse, The Genting Permaipura Golf & Country Club. Genting Pura Kencana Sri Gading

is the newest real estate project from Genting Property and is located near the town of Batu Pahat.

This project can be easily reached from Malaysias most comprehensive highway, the North -

South Expressway, and is located near amenities such as a hypermarket, malls and tertiary

institutions. Genting Plantations has also boldly ventured into the biotechnology industry.

In 2007, the company through subsidiary ACGT Sdn Bhd entered into a joint venture

with US-based Synthetic Genomics, Inc. In line with its aim to be a world-class centre of

excellence in genomic science in Malaysia, ACGT is receiving technical assistance from the

highly acclaimed US-based J. Craig Venter Institute to explore the use of genomics-based

techniques to improve yields and profit streams of oil palm.
http://www.genting.com.my/http://www.genting.com.my/

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COMPLIANCE LEVEL OF THE COMPANY

FRS 117 LEASE

The objective of this Standard is to prescribe, for lessees and lessors, the appropriate accountingpolicies and disclosure to apply in relation to leases.

This Standard shall be applied in accounting for all leases other than:

a. Leases to explore for or use minerals, oil, nature gas abd and similar non-regenerativeresources.

b. Licensing agreements for such items as motion picture films, video recordings,manuscripts, patents and copyright.

This Standard applies to agreements that transfer the right to use assets even though substantial

services by the lessor or may be called for in connection with the operation or maintenance of such

assets. This Standard does not apply to agreements that are contracts for services that do not transfer

the right to use assets from one contracting party to the other.

FRS 117 (Para35)Disclosure in the financial statements of lessees (Operating leases)

Disclosure Requirement Kretam

Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd1) The total of future

minimum lease paymentsunder non-cancellable

operating leases for each of

the following periods:

Not later than oneyear;

Later than one yearbut not more than five

years; and

Later than five years;

X X

2) The total of futureminimum sublease

payments expected to be

received under non-cancellable subleases at the

balance sheet date

X X X

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3) Lease and subleasepayments recognized in theprofit and loss account for

the period, with separate

amounts for minimum

lease payments, contingentrents, and sublease

payments

X X

4) A general description ofthe leassees significantleasing arrangements

including, but not limited

to, the following:

The basis on whichcontingent rentpayments are

determined; The existence and

terms of renewal or

purchase options andescalation clauses; and

Restrictions imposedby lease agreements,

such as those

concerning dividends,

additional debt, andfurther leasing.

X X

FRS 117 (Para 31) Disclosure in the financial statements of lessees (Finance leases)


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd

1)

The net carrying amount ofeach major class of leased

assets at the balance sheetdate

X2) A reconciliation of the

minimum lease payments

at the balance sheet andtheir present value

X X

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3) The total of minimum leasepayments at the balancesheet date, and their

present value, for each of

the following period:

Not later than one year Later than one year but

not more than five

years;

Later than five years.

X X

4) Contingent rest recognizedin the profit and loss

account for the periodX NIL X

5) The total of futureminimum subleasepayments expected to be

received under non-

cancellable subleases at the

balance sheet date

X X

6) A general description ofthe lessees significant

leasing arrangements

including, but not limited

to the following:

The basis on whichcontingent rent

payments are

determined;

The existence andterms of renewal or

purchase options and

escalation clauses; and

Restrictions imposedby lease agreements,

such as those

concerning dividends,additional debts, andfurther leasing.

X

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FRS 117 (Para 56 & 57) Disclosure in the financial statements of lessors (Operating leases)


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd1) The future minimum lease

payments under non-cancellable operating

leases in the aggregate andfor each of the following

periods:

Not later than one year; Later than one year but

not more than fiveyears; and

Later than five years

X X

2) Total contingent rentsrecognised for the period.

X 3) A general description of

significant leasing

arrangements. X

4) Para 57 of FRS 117, forassets leased out underoperating leases, the

disclosure of:

The gross carryingamount;

The accumulateddepreciation;

The accumulatedimpairment losses;

The depreciationcharge of the period;

The impairment lossesrecognised for the

period; and

The impairment lossesreversed for the

period.

X X X

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FRS 117 (Para 45)Disclosure in the financial statements of lessors (Finance leases)


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd1) A reconciliation between

the gross investment in thelease at the balance sheet

date and the present valueof the minimum lease

payments receivable at the

balance sheet date

X X X

2) The total gross investmentin the lease and the presentvalue of the minimum

lease payments receivable

at the balance sheet date,

for each of the fallowingperiods:

Not later than one year; Later than one year but

not more than fiveyears;

Later than five years;

X X

3) Unearned finance income NIL NIL X4) The unguaranteed residual

values accruing to thebenefit of the lessor

X X X

5) The accumulatedallowance for uncollectiblelease receivable

X X X

6) Contingent rentsrecognized in income for

the period NIL X

7) A general description ofsignificant leasing

arrangements

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Kretam Holdings Bhd

FRS 117 (Para35)Disclosure in the financial statements of lessees (Operating leases)

1. The total of future minimum lease payments under non-cancellable operating leases foreach of the following periods:

Not later than one year; Later than one year but not more than five years; and Later than five years.

3. Lease and sublease payments recognized in the profit and loss account for the period, withseparate amounts for minimum lease payments, contingent rents, and sublease payments.

4. A general description of the leassees significant leasing arrangements including The existence and terms of renewal or purchase options and escalation clauses.

The total of future minimum sublease payments expected to be received under non-

cancellable subleases at the balance sheet date in FRS 117 Para 35 should be disclosure,

but the Kreatam Holdings Bhd do not prepared it.

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1. The net carrying amount of each major class of leased assets at the balance sheet date.

2. A reconciliation of the minimum lease payments at the balance sheet and their presentvalue.

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3. The total of minimum lease payments at the balance sheet date, and their present value,for each of the following period:

Not later than one year Later than one year but not more than five years; Later than five years.

5. The total of future minimum sublease payments expected to be received under non-cancellable subleases at the balance sheet date.

6. A general description of the lessees significant leasing arrangements including The existence and terms of renewal or purchase options and escalation clauses

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FRS 117 (Para 56 & 57)Disclosure in the financial statements of lessors (Operating leases)

1. The future minimum lease payments under non-cancellable operating leases in theaggregate and for each of the following periods:

Not later than one year; Later than one year but not more than five years; and Later than five years

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2. Total contingent rents recognised for the period.

2.27Revenue

3. A general description of significant leasing arrangements.

Para 57 of FRS 117, for assets leased out under operating leases also did not disclosure the

gross carrying amount.

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FRS 117 (Para 45) Disclosure in the financial statements of lessors (Finance leases)

6. Contingent rents recognized in income for the period.7. A general description of significant leasing arrangements.

Kretam holdins Bhd dont have any unearned finance income.

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1. The net carrying amount of each major class of leased assets at the balance sheet date.

5. Contingent rest recognized in the profit and loss account for the period.

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6. A general description of the lessees significant leasing arrangements including, but notlimited to the following:

The basis on which contingent rent payments are determined; The existence and terms of renewal or purchase options and escalation clauses; and Restrictions imposed by lease agreements, such as those concerning dividends,

additional debts, and further leasing.



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FRS 117 (Para 56 & 57) Disclosure in the financial statements of lessors (Operating leases)

2. The Group does not recognise a contingent liability but discloses its existence in the financialstatements, except in a business combination.

No contingent or other liability of the Group or of the company has become enforceable, or is

likely to become enforceable within the period of twelve months after the end of the financial

year which, in the opinion of the Directors, will or may substantially affect the ability of the

Group or of the Company to meet their obligations as and when they fall due.

The Group does not recognise a contingent liability but discloses its existence in the financial

statements, except in a business combination.

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2. The total gross investment in the lease and the present value of the minimum lease paymentsreceivable at the balance sheet date, for each of the fallowing periods:

Not later than one year in year 2010; Later than one year but not more than five years in year 2009.

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Level of Compliance for FRS 117

As we can see from above, Kretam Holding has the highest level of compliance among

the company that we have studied with 65%, followed by Genting Plantation with 19% level of

compliance. The Sarawak Plantation has the lowest level of compliance with 16.7%.

0

10

20

30

40

50

60

70

Kretam Holding Sarawak Plantation Genting Plantation

FRS 117

Percentage %

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FRS 136 IMPAIRMENT OF ASSETS

The objective of this Standard is to prescribe the procedures that an entity applies to ensure that its

assets are carried at no more that their recoverable amount. An asset is carried at more than

recoverable amount if its carrying amount exceeds the amount to be recovered though use or sales

of the asset. If this is the case, the asset is described as impaired and the Standard requires the entity

to recognize an impairment loss. The Standard also specified when an entity should reverse an

impairment loss and prescribes disclosures

FRS 136 prescribes accounting and disclosure for impairment of assets. The objective is mainly to

ensure that assets are not carried in the balance sheet at amounts higher than their recoverable

amounts. Where there is impairment loss or reversal of impairment loss for the period, FRS 136,

Para 126 require the following disclosures for each class of assets:

FRS 136 (Para126)Impairment loss or reversal of impairment loss for the period


Holdings Bhd

Sarawak

Plantation(SPB)

Genting

Plantations Bhd1) The amount of impairment

losses recognized in profit or

loss during the period and theline item of the incomestatement in which those

impairment losses are included.

X 2) The amount of reversals of

impairment losses recognized in

profit or loss during the periodand the line item of the income

statement in which those

impairment losses are reversed.

X NIL X

3) The amount of impairmentlosses recognized directly inequity during the period. X

4) The amount of reversals ofimpairment losses recognizeddirectly in equity during the

period.

X X X

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Kretam Holdings Bhd


3. The amount of impairment losses recognized directly in equity during the period.

The amount of impairment losses is not recognized in profit or loss during the period, but is

recognized at Statement of Changes of Equity and the line items of impairment losses are

not included.

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The amount of reversals of impairment losses is not recognized in profit or loss or in

equity during the period. That are recognized at Statement of Cash Flows, and the line

item for allowance for impairment and reversal of impairment looses is stated in above

notes.

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1) The amount of impairment losses recognized in profit or loss during the period and the lineitem of the income statement in which those impairment losses are included.

2)

The amount of reversals of impairment losses recognized in profit or loss during the periodand the line item of the income statement in

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(1)and (3) impairment losses recognised in profit or loss on equity instruments classified asavailable for sale are reversed through other comprehensive income and not through profit

or loss.

Here are the explanation and amount of impairment loss for (1) and (3).

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Level of Compliance with FRS 136

As we can see from above, the level of compliance with frs 136 is the highest in the

Genting Plantation company with 50%, followed by Sarawak Plantation with 33%. The lowest

level of compliance goes to the Kretam Holding with 20%.

0

10

20

30

40

50

60


FRS 136

Percentage%

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FRS 138 Intangible Assets

The objective of this Standard is to prescribe the accounting treatment for intangible assets that are

not dealt with specifically in another Standard. This Standard requires an entity to recognize

intangible assets if, and only if, specified criteria are met. The Standard also specie how to measure

the carrying amount of intangible assets and requires specifies disclosures about intangible assets.

This Standard shall be applied in accounting for intangible assets, except:

a. Intangible assets that are within the scope of another Standard.b. Financial assets, as defined in FRS 139 Financial Instruments: Recognition and

Measurement.c. The recognition and measurement of exploration and evaluation assets (see IFRS 6)

Exploration for and Evaluation of Mineral Resources.

d. Expenditure on the development and extraction of, mineral, oil natural gas and similarnon- regeneration resources.

FRS 138 (Para 118)Class of intangible assets, distinguishing between internally generated

intangible assets and other intangible asset


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd1) Whether the useful are

finite or indefinite, and if

finite, the useful lives or

the amortisation rates used.

X 2) The amortisation methods

used for intangible assets

with finite useful lives. X

3) The gross carrying amountand the accumulatedamortization (aggregated

with accumulated

impairment losses) at thebeginning and end of the

period.

X

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4) The line item of the incomestatement in which theamortisation of assets

included.

X X X

5) A reconciliation of thecarrying amount at thebeginning and end of the

period.

Additions, indicatingseparately those from

internal development,

those acquired

separately and thoseacquired through

business combinations;

Assets classified asheld for sale, and otherdisposals;

Increases or decreasesduring the periodresulting from

revaluations and from

impairment losses

recognized or reverseddirectly in equity;

Impairment lossesrecognized in the

income statementduring the period under

FRS 136;

Impairment lossesreversed in the incomestatement during the

period under FRS 136;

Any amortizationrecognised during the

period;

Net exchangedifferences arising onthe translation of the

financial statements ofa foreign entity; and

Other changes in thecarrying amount duringthe period.

X

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FRS 138 (Para 122)Additional disclosure requirement


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd

1) For an intangible assetassessed as having anindefinite useful life, the

carrying amount of that

asset and the reasonssupporting the assessment

of an indefinite useful life.

In giving these reasons, the

entity shall describe thefactor(s) that played a

significant role in

determining that the assethas an indefinite useful

life.

X X

2) A description, the carryingamount and remaining

amortisation period of any

individual intangible asset

that is material to theentity's financial

statements.

NIL X X

3) For intangible assetsacquired by way of a

government grant and

initially recognized at fair

value:

The fair value initiallyrecognized for these

assets;

Their carrying amount;and

Whether they aremeasured afterrecognition under the

cost model or therevaluation model.

X X

4) The existence and carryingamounts of intangible

assets whose title is

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restricted and the carrying

amounts of intangibleassets pledged as security

for liabilities.

NIL X X

5) The amount of contractualcommitments for theacquisition of intangibleassets.

X X

FRS 138 (Para 124) Additional disclosure for intangible assets are carried at revalued

amounts


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd1) By class of intangible

assets:

a) The effective date ofthe revaluation;

b) The carrying amount ofrevalued intangible

assets; and

c) The carrying amountthat would have been

included in the

financial statementshad the revalued

intangible assets been

measured using thecost model.

X X

2) The amount of therevaluation surplus that

relates to intangible assets

at the beginning and end of

the period, indicating thechanges during the period

and any restrictions on thedistribution of the balanceto shareholders.

X

3) The methods andsignificant assumptions

applied in estimating the

assets fair values.

NIL X X

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Kretam Holdings Bhd

FRS 138 (Para 118) Class of intangible assets, distinguishing between internally

generated intangible assets and other intangible asset

1. Whether the useful are finite or indefinite, and if finite, the useful lives or the amortisationrates used.

2. The amortisation methods used for intangible assets with finite useful lives.3. The gross carrying amount and the accumulated amortization (aggregated with accumulated

impairment losses) at the beginning and end of the period.

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5. A reconciliation of the carrying amount at the beginning and end of the period. Additions, indicating separately those from internal development, those acquired

separately and those acquired through business combinations;

Assets classified as held for sale, and other disposals; Increases or decreases during the period resulting from revaluations and from impairment

losses recognized or reversed directly in equity;

Impairment losses recognized in the income statement during the period under FRS 136; Impairment losses reversed in the income statement during the period under FRS 136; Any amortization recognised during the period; Net exchange differences arising on the translation of the financial statements of a

foreign entity; and

Other changes in the carrying amount during the period.

The line item of the income statement in which the amortisation of assets are not included in

annual report for Kretam Holdings Bhd.

FRS 138 (Para 122) Additional disclosure requirement

1. For an intangible asset assessed as having an indefinite useful life, the carrying amount ofthat asset and the reasons supporting the assessment of an indefinite useful life. In giving

these reasons, the entity shall describe the factor(s) that played a significant role in

determining that the asset has an indefinite useful life.

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3. For intangible assets acquired by way of a government grant and initially recognized at fairvalue:

The fair value initially recognized for these assets; Their carrying amount; and Whether they are measured after recognition under the cost model or the revaluation

model.

5. The amount of contractual commitments for the acquisition of intangible assets.

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amounts

1. By class of intangible assets:d) The effective date of the revaluation;e) The carrying amount of revalued intangible assets; andf) The carrying amount that would have been included in the financial statements had the

revalued intangible assets been measured using the cost model.

2. The amount of the revaluation surplus that relates to intangible assets at the beginning andend of the period, indicating the changes during the period and any restrictions on the

distribution of the balance to shareholders.

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1. Whether the useful are finite or indefinite, and if finite, the useful lives or theamortisation rates used.

For finite useful life;

Evidence of amortisation occurred but it did not state the rate of amortisation:

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For indefinite useful life

2. Capitalised development costs are recorded as intangible assets and amortised from thepoint at which the asset is ready for use or sale, on a straight-line basis over useful life,

not exceeding twenty years.

The amortisation methods used for intangible assets with finite useful lives.

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3. The gross carrying amount and the accumulated amortization (aggregated with accumulatedimpairment losses) at the beginning and end of the period.

5. A reconciliation of the carrying amount at the beginning and end of the period. (increase in 2010)

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amounts

2. The amount of the revaluation surplus that relates to intangible assets at the beginningand end of the period.

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As shown above, Kretam Holding has the highest level of compliance with FRS 138 with

a percentage of 90%, followed by Genting Plantation with a percentage of 38%. Sarawak

Plantation did not comply at all with FRS138. This is clearly stated in the notes that is included

for the financial statement.

0

10

20

30

40

50

60

70

80

90

100


FRS 138

Percentage %

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FRS 140 INVESTMENT PROPERTY

The Objective of this Standard is to prescribe the accounting treatment for investment property and

related disclosures requirements.

FRS 140 defines Investment Property as land or a building or part of building or land and building

held (by the owner or under finance lease) to earned rental or for capital appreciation or both.

Investment Property:

Land held for long -term (>5yrs) capital appreciation-ex land for housing, public utilities etc.

land held for undetermined future use - ex remote land for plantation building owned building that is vacant but is held to be leased out under operating leased

FRS 140 (Para 75) For all investment property


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd1) Whether the cost model or

the fair value model is

used.

2) If the fair value model isused, whether, and in what

circumstances, propertyinterest held under

operating leases are

classified and accounted

for as investment property.

NIL NIL X

3) When classification isdifficult, the criteria usedto identify investment

properties.

X 4) The methods and

significant assumptions

applied in estimating thefair value of investment

property.

NIL

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5) The extent to which fairvalue is based on valuationby an independent

professional valuer.

NIL 6) The amount included in the

income statements for: (i)rental income;(ii)directoperating expenses arising

from investment property

that generate rental incomeduring the period and

(iii)direct operating

expenses arising from

investment property thatdid not generate rental

income during the period.

NIL

7)

Material contractualobligation. NIL X X

FRS 140 (Para 79) Additional disclosure requirements for cost model


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd1) The depreciation method

used.

2) The useful lives or the

depreciation rates used.

3) The gross carrying amountand the accumulated

depreciation (together withaccumulated impairment

losses) at the beginning

and end of the period.

NIL

4) A reconciliation of thecarrying amount of

investment property at thebeginning and end of the

period.

NIL5) The fair value of the

investment property. NIL

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FRS 140 (Para 76) Additional disclosure requirements for fair value model


Holdings BhdSarawak

Plantation (SPB)Genting

Plantations Bhd1) Reconciliation of the

carrying amount ofinvestment property at the

beginning and end of the

period

NIL

FRS 140 (Para 78) For investment property the fair value model but its fair value cannot be

measured reliably


Holdings Bhd

Sarawak

Plantation (SPB)

Genting

Plantations Bhd1) A description of the

property. NIL NIL

2) An explanation why fairvalue cannot be determined

reliably.NIL NIL X

3) If possible, the range ofestimates within which fair

value is highly likely to lie.NIL NIL X

4) Upon disposal, the carryingamount and the gain or loss

arising there form. NIL NIL

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Kretam Holdings Bhd


1. Whether the cost model or the fair value model is used.

6. When classification is difficult, the criteria used to identify investment properties.7. The methods and significant assumptions applied in estimating the fair value of investment

property.

FRS 140 (Para 79)

Additional disclosure requirements for cost model

1. The depreciation method used.2. The useful lives or the depreciation rates used.

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3. The gross carrying amount and the accumulated depreciation (together with accumulatedimpairment losses) at the beginning and end of the period.

4. A reconciliation of the carrying amount of investment property at the beginning and end ofthe period.

5. The fair value of the investment property.


1.

Reconciliation of the carrying amount of investment property at the beginning and end of theperiod

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FRS 140 (Para 78) For investment property the fair value model but its fair value cannot

be measured reliably

1. A description of the property.

4. Upon disposal, the carrying amount and the gain or loss arising there form.

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1. Whether the cost model or the fair value model is used

5. The extent to which fair value is based on valuation by an independent professionalvaluer.

6. The amount included in the income statements for:I. Rental income

II. Direct operating expenses arising from investment property that generate rentalincome during the period and

III. Direct operating expenses arising from investment property that did not generaterental income during the period.

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FRS 140 (Para 79) Additional disclosure requirements for cost model

1. The depreciation method used

2. The useful lives or the depreciation rates used.

3. The gross carrying amount and the accumulated depreciation (together with accumulatedimpairment losses) at the beginning and end of the period.

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4. A reconciliation of the carrying amount of investment property at the beginning and endof the period

5. The fair value of the investment property.

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1. Whether the cost model or the fair value model is used. (Both) Cost Model:

Fair Model

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3. Investment properties under construction before 1 January 2010 were classified asproperty, plant and equipment and measured at cost. Following to the amendment made

to FRS 140, such properties are treated as investment property and accounted as such

retrospectively.

When classification is difficult, the criteria used to identify investment properties.

4. The fair values of the investment properties were based on valuation by independentprofessional qualified valuers. Valuations were based on sales of comparable

properties in the vicinity. The methods and significant assumptions applied in

estimating the fair value of investment property.

5. The fair values of the investment properties were based on valuation by independentprofessional qualified valuers. Valuations were based on sales of comparable

properties in the vicinity. The extent to which fair value is based on valuation by an

independent professional valuer.

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6. The amount included in the income statements for:(i) rental income;

(ii)direct operating expenses arising from investment property that generate rental

income during the period

FRS 140 (Para 79)

Additional disclosure requirements for cost model

1. Depreciation for other investment properties is calculated using the straight-linemethod to allocate their costs over their estimated useful lives. The depreciation

method used.

2. The useful lives or the depreciation rates used.

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1. Reconciliation of the carrying amount of investment property at the beginning andend of the period,

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As shown above, Kretam Holding has the highest level of compliance with FRS 140

among the company that was studied with a 100%,followed by Sarawak Plantation with 80%.

The lowest compliance to FRS 140 goes to Genting Plantation with a percentage of 67%.

Conclusion

Overall, the highest compliance to all the FRS that we have studied among the company

that we have researched on goes to the Kretam Holding. This is followed by Sarawak Plantation

and finally Genting Plantation.

Through this research, we have found that the level of compliance to FRS is completely

in the hand of the company. Even if disclosure of a particular item is required by FRS, but if the

0

20

40

60

80

100

120


FRS 140

Percentage %

Documents

fa report(c) (1)