Page 250 - Index

i) Financial assets that are measured at
amortised cost e.g., loans, deposits, and
bank balances.
ii) Trade receivables.
The Company follows ‘simplified approach’ for
recognition of impairment loss allowance on trade
receivables which do not contain a significant financing
component. The application of simplified approach
does not require the Company to track changes in credit
risk. Rather, it recognises impairment loss allowance
based on lifetime ECLs at each reporting date.
For all other financial assets, ECL is measured at an
amount equal to the twelve month ECL unless there
has been a significant increase in credit risk from the
initial recognition in which case those are measured at
lifetime ECL.
2.8 Leases
The Company’s lease assets consists of office
premises. The Company assesses whether a contract
contains a lease, at inception of a contract. A contract
is, or contains, a lease if the contract conveys the right
to control the use of an identified asset for a period of
time in exchange for consideration.
To assess whether a contract conveys the right to
control the use of an identified asset, the Company
assesses whether:
(i) the contract involves the use of an identified asset
(ii) the Company has substantially all of the economic
benefits from use of the asset through the period
of the lease and
(iii) the Company has the right to direct the use of
the asset
Where the Company is a lessee
The Company determines the lease term as the non-
cancellable period of a lease, together with periods
covered by an option to extend the lease, where the
Company is reasonably certain to exercise that option.
At the date of commencement of the lease, the
Company recognises a right of use asset and a
corresponding lease liability for all lease arrangements
in which it is a lessee, except for leases with a term of
twelve months or less (short-term leases) and leases
of low value assets. For these short-term and leases
248 Annual Report 2024
Standalone
of low value assets, the Company recognises the lease
payments as an operating expense on a straight-line
basis over the term of the lease.
The cost of the right of use asset measured at
inception shall comprise of the amount of the initial
measurement of the lease liability adjusted for any
lease payments made at or before the commencement
date less any lease incentives received, plus any initial
direct costs incurred and an estimate of costs to be
incurred by the lessee in dismantling and removing the
underlying asset or restoring the underlying asset or
site on which it is located.
The right of use assets is subsequently measured at
cost less any accumulated depreciation, accumulated
impairment losses, if any and adjusted for any
remeasurement of the lease liability. The right of use
assets is depreciated using the straight-line method
from the commencement date over the shorter of lease
term or useful life of right of use asset. The estimated
useful lives of right of use assets are determined on the
same basis as those of property, plant and equipment.
Right of use assets are tested for impairment whenever
there is any indication that their carrying amounts
may not be recoverable. Impairment loss, if any, is
recognised in the statement of profit and loss.
The Company measures the lease liability at the present
value of the lease payments that are not paid at the
commencement date of the lease. The lease payments
are discounted using the interest rate implicit in the
lease, if that rate can be readily determined. If that
rate cannot be readily determined, the Company uses
incremental borrowing rate.
The lease payments shall include fixed payments,
variable lease payments based on an index or rate,
residual value guarantees, exercise price of a purchase
option where the Company is reasonably certain to
exercise that option and payments of penalties for
terminating the lease, if the lease term reflects the
lessee exercising an option to terminate the lease.
The lease liability is subsequently remeasured by
increasing the carrying amount to reflect interest on
the lease liability, reducing the carrying amount to
reflect the lease payments made and remeasuring the
carrying amount to reflect any reassessment or lease
modifications or to reflect revised in-substance fixed
lease payments.