FIMA CORPORATION ANNUAL REPORT 2019

Notes To The

Financial Statements

As at 31 March 2019

39. Explanation of transition to MFRS (cont’d.)

The significant accounting policies adopted in preparing the financial statements are consistent with those of

the audited financial statement for the year ended 31 March 2018, except as discussed below: (cont’d.)

(a) Transition from FRS to MFRS Framework (cont’d.)

(ii) Foreign currency translation difference

Under FRS, the Group recognised foreign currency translation differences in other comprehensive

income and accumulated the amount in the foreign currency translation deficit in equity.

Upon transition to MFRS, the Group has elected to deem all foreign currency translation differences

that arose prior to the date of transition in respect of all foreign operations to be nil at the date of

transition.

(b) Adoption of MFRS 9 Financial Instruments

MFRS 9 replaces MFRS 139 and amends the previous requirements in three main area (i) classification

and measurement of financial assets; (ii) impairment of financial assets, mainly by introducing a forward

looking expected loss impairment model and (iii) hedge accounting including removing some of the

restrictions on applying hedge accounting in MFRS 139. With the exeption of hedge accounting, the Group

has applied MFRS 9 retrospectively, with the initial application date of 1 April 2018 and adjusting the

comparative information for the period beginning 1 April 2017.

The impact of MFRS 9 adoption is described below:

(i) Classification and measurement

MFRS 9 contains a new classification and measurement approach for the financial assets that reflects

the business model in which the assets are managed and their cash flows characteristics.

MFRS 9 contains three principal classification catergories for the financial assets as follows:

Financial assets at amortised cost (debt instruments)

Financial assets at fair value through profit or loss

Financial assets at fair value through other comprehensive income

The standard also eliminates the previous FRS 139 categories of Held - to - Maturity, Loan and

Receivables (“L&R”) and Available-for-Sale (“AFS”). All the Group’s and the Company’s financial

liabilities previously categorised under L&R are now categorised as financial liabilities at amortised

cost.

184

Fima Corporation Berhad

(21185-P)

Annual Report 2019