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Annual Report 2013
KPJ HEALTHCARE BERHAD
191
2.
Summary of signi cant accounting policies (continued)
2.21 Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable
that an out ow of economic resources will be required to settle the obligation and the amount of the obligation can be estimated
reliably.
Provisions are reviewed at each reporting date and adjusted to re ect the current best estimate. If it is no longer probable that an
out ow of economic resources will be required to settle the obligation, the provision is reversed. If the effect of the time value of
money is material, provisions are discounted using a current pre tax rate that re ects, where appropriate, the risks speci c to the
liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a nance cost.
2.22 Employee bene ts
(a)
Short term bene ts
Wages, salaries, bonuses and social security contributions are recognised as an expense in the period in which the
associated services are rendered by employees of the Group. 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.
(b)
De ned contribution plans
The Group participates in the national pension schemes as de ned by the laws of the countries in which it has operations. The
Malaysian companies in the Group make contributions to the Employees Provident Fund in Malaysia, a de ned contribution
pension scheme. Contributions to de ned contribution pension schemes are recognised as an expense in the period in
which the related service is performed.
2.23 Revenue
Revenue is recognised to the extent that it is probable that the economic bene ts will ow to the Group and the revenue can be
reliably measured. Revenue is measured at the fair value of consideration received or receivable.
(a)
Sale of goods and rendering of services
Revenue from hospital operations comprises inpatient and outpatient hospital charges, consultation fees, and sales of
pharmaceutical products, medical supplies and surgical products. These are recognised when services are rendered and
goods are delivered, net of discounts, rebates and returns.
Other hospital revenue mainly consists of clinic rental for consultants. These are recognised on an accrual basis in
accordance with the substance of the relevant agreements.
(b)
Wellness subscription fees
Wellness subscription fees are recognised over the membership period.
Annual renewal fees are recognised on the accrual basis based on fees chargeable to members upon execution and renewal
of the membership.
Notes to the
Financial Statements
For the financial year ended 31 December 2013
(continued)