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Notes to the
Financial Statements
As at 31 March 2020
Fima CORPORATION Berhad
(197401004110) (21185-P) •
Annual Report 2020
136
2.
Significant accounting policies (cont’d.)
2.4 Summary of significant accounting policies (cont’d.)
(t) Employee benefits (cont’d.)
(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.
(iii) Defined benefit plan
The foreign subsidiary in Indonesia, operates an unfunded, defined benefit Retirement Benefit Scheme (“the
Scheme”) for its eligible employees. The foreign subsidiary’s obligation under the Scheme, calculated using the
Projected Unit Credit Method, is determined based on actuarial assumptions by independent actuaries, through
which the amount of benefit that employees have earned in return for their services in the current and prior
years is estimated. That benefit is discounted in order to determine its present value. Actuarial gains and losses
are recognised immediately through other comprehensive income in order for the net pension assets or liability
recognised in the consolidated statement of financial position to reflect the full value of the plan deficit or surplus.
Past service costs are recognised immediately to the extent that the benefits are already vested, and otherwise are
amortised on a straight-line basis over the average period until the amended benefits become vested.
The amount recognised in the statement of financial position represents the present value of the defined benefit
obligations adjusted for unrecognised past service costs, and reduced by the fair value of plan assets. Any asset
resulting from this calculation is limited to the net total of any past service costs, and the present value of any
economic benefits in the form of refunds or reductions in future contributions to the plan.
The latest actuarial valuation was carried out using the employee data as at 31 March 2020 by PT Sentra Jasa
Aktuaria, an independent actuary report dated 11 June 2020.
(u) Leases
Accounting policies applied from 1 April 2019
(i) As lessee
The Group applies a single recognition and measurement approach for all leases, except for short-term leases and
leases of low-value assets. The Group recognises lease liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.
Right-of-use assets
The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use
asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease
payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of
costs to dismantle and remove the underlying asset or to restore the underlying asset or site on which it is located,
less any lease incentives received.