2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2.15 Leases (continued)
(a) As lessee (continued)
Leased assets are depreciated over the estimated useful life of the asset. However, if there is no reasonable
certainty that the Group will obtain ownership by the end of the lease term, the asset is depreciated over the
shorter of the estimated useful life and the lease term.
Operating lease payments are recognised as an expense in profit or loss on a straight-line basis over the lease
term. The aggregate benefit of incentives provided by the lessor is recognised as a reduction of rental expense
over the lease term on a straight-line basis. Contingent rents, if any, are charged as expenses in the periods in
which they are incurred.
(b) As lessor
Leases where the Group retains substantially all the risks and rewards of ownership of the asset are classified
as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying
amount of the leased asset and recognised over the lease term on the same bases as rental income.
2.16 Trade and other receivables
Trade receivables are amounts due from customers for merchandise sold or services performed in the ordinary course
of business. Other receivables generally arise from transactions outside the usual operating activities of the Group. If
collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are
classified as current assets. If not, they are presented as non-current assets.
Trade and other receivables are recognised initially at fair value. Trade and other receivables are recognised initially
at fair value, with the amount of goods and services tax (GST) included. The net amount of GST recoverable from the
government is presented as GST receivable within other receivables in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows which
are recoverable from, or payable to, the government are classified as operating cash flows.
After recognition, trade and other receivables are subsequently measured at amortised cost using the effective
interest method, less provision for impairment. See accounting policy Note 2.12(d) on impairment of financial assets.
2.17 Non-current assets (or disposal groups) classified as assets held for sale
Non-current assets (or disposal groups) are classified as assets held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through continuing use. This condition is regarded as met only when
the sale is highly probable and the asset is available for immediate sale in its present condition subject only to terms
that are usual and customary.
249
KPJ Healthcare Berhad
Annual Report
2015
NOTES TO THE
FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2015 (CONTINUED)
