123 / 188
119
NOTES TO THE FINANCIAL STATEMENTS
F i m a C o r p o r at i o n B e r h a d ( 2 1 1 8 5 - P ) •
A n n u a l R e p o r t 2 0 1 8
2.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D.)
2.3 Summary of Significant Accounting Policies (Cont’d.)
(s) Foreign Currencies (Cont’d.)
(ii) Foreign currency transactions (Cont’d.)
Exchange differences arising on the settlement of monetary items, and on the translation of monetary items,
are included in profit or loss for the period except for exchange differences arising on monetary items that
form part of the Group’s net investment in foreign operation. These are initially taken directly to the foreign
currency translation reserve within equity until the disposal of the foreign operations, at which time they are
recognised in profit or loss. Exchange differences arising on monetary items that form part of the Company’s
net investment in foreign operation are recognised in profit or loss in the Company’s separate financial
statements or the individual financial statements of the foreign operation, as appropriate.
Exchange differences arising on the translation of non-monetary items carried at fair value are included in
profit or loss for the period except for the differences arising on the translation of non-monetary items in
respect of which gains and losses are recognised directly in equity. Exchange differences arising from such
non-monetary items are also recognised directly in equity.
(iii) Foreign operations
The results and financial position of foreign operations that have a functional currency different from the
presentation currency, RM, of the consolidated financial statements are translated into RM as follows:
-
Assets and liabilities for each statement of financial position presented are translated at the closing rate
prevailing at the reporting date;
-
Income and expenses for each profit or loss are translated at average exchange rates for the year,
which approximates the exchange rates at the dates of the transactions; and
-
All resulting exchange differences are taken to the foreign currency translation reserve within
equity.
(t)
Employee Benefits
(i)
Short term benefits
Wages, salaries, bonuses and social security contributions are recognised as an expense in the year in
which the associated services are rendered by employees of the Group and of the Company. Short term
accumulating compensated absences such as paid annual leave are recognised when services are rendered
by employees that increase their entitlement to future compensated absences. Short term non-accumulating
compensated absences such as sick leave are recognised when the absences occur.
(ii) Defined contribution plan
As required by law, companies in Malaysia make contributions to the state pension scheme, the Employees
Provident Fund (“EPF”). Such contributions are recognised as an expense in the profit or loss as
incurred.