ANNUAL REPORT 2016
56
Techno
Dex
Berhad
(627634-A)
4. SIGNIFICANT ACCOUNTING POLICIES (continued)
4.10 IMPAIRMENT (continued)
(b) Impairment of Non-Financial Assets
The carrying values of assets, other than those to which MFRS 136 - Impairment of Assets does not
apply, are reviewed at the end of each reporting period for impairment when there is an indication that
the assets might be impaired. Impairment is measured by comparing the carrying values of the assets
with their recoverable amounts. The recoverable amount of the assets is the higher of the assets’ fair
value less costs to sell and their value in use, which is measured by reference to discounted future cash
flow.
An impairment loss is recognised in profit or loss immediately.
When there is a change in the estimates used to determine the recoverable amount, a subsequent
increase in the recoverable amount of an asset is treated as a reversal of the previous impairment loss
and is recognised to the extent of the carrying amount of the asset that would have been determined
(net of amortisation and depreciation) had no impairment loss been recognised. The reversal is
recognised in profit or loss immediately.
4.11 ASSETS UNDER HIRE PURCHASE
Assets acquired under hire purchase are capitalised in the financial statements at the lower of the fair
value of the leased assets and the present value of the minimum lease payments and, are depreciated in
accordance with the policy set out in Note 4.7 above. Each hire purchase payment is allocated between the
liability and finance charges so as to achieve a constant rate on the finance balance outstanding. Finance
charges are recognised in profit or loss over the period of the respective hire purchase agreements.
4.12 INCOME TAXES
Income tax for the year comprises current and deferred tax.
Current tax is the expected amount of income taxes payable in respect of the taxable profit for the reporting
year and is measured using the tax rates that have been enacted or substantively enacted at the end of the
reporting period.
Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the financial statements.
Deferred tax liabilities are recognised for all taxable temporary differences other than those that arise from
goodwill or excess of the acquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities
and contingent liabilities over the business combination costs or from the initial recognition of an asset
or liability in a transaction which is not a business combination and at the time of the transaction, affects
neither accounting profit nor taxable profit.
Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused
tax credits to the extent that it is probable that future taxable profits will be available against which the
deductible temporary differences, unused tax losses and unused tax credits can be utilised. The carrying
amounts of deferred tax assets are reviewed at the end of each reporting period and reduced to the extent
that it is no longer probable that sufficient future taxable profits will be available to allow all or part of the
deferred tax assets to be utilised.
NOTES TO THE
FINANCIAL STATEMENTS
(continued)
