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KUMPULAN FIMA BERHAD
(11817-V) |
Annual Report
2016
2. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
2.3 Summary of Significant Accounting Policies (Cont’d)
(g) Foreign Currencies (Cont’d)
(ii) Foreign Currency Transactions
Transactions in foreign currencies other than the Company’s functional currency (foreign
currencies) are recorded in the functional currencies at exchange rates approximating those
ruling at the transaction dates. At each reporting date, monetary items denominated in foreign
currencies are translated at the rates prevailing on the reporting date. Non-monetary items
carried at fair value that are denominated in foreign currencies are translated at the rates
prevailing on the date when the fair value was determined. Non-monetary items that are
measured in terms of historical cost in a foreign currency are not translated.
Exchange differences arising on the settlement of monetary items, and on the translation
of monetary items, are included in the profit or loss for the period except for exchange
differences arising on monetary items that form part of the Group’s net investment in foreign
operation. These are initially taken directly to the foreign currency translation reserve within
equity until the disposal of the foreign operations, at which time they are recognised in profit
or loss. Exchange differences arising on monetary items that form part of the Company’s net
investment in foreign operation are recognised in profit or loss in the Company’s separate
financial statements or the individual financial statements of the foreign operation, as
appropriate.
Exchange difference arising on the retranslation of non-monetary items carried at fair
value are included in profit or loss for the period except for the differences arising on the
retranslation of non-monetary items in respect of which gains and losses are recognised
directly in equity. Exchange differences arising from such non-monetary items are also
recognised directly in equity.
(iii) Foreign Operations
The results and financial position of foreign operations that have a functional currency
different from the presentation currency, RM of the consolidated financial statements are
translated into RM as follows:
-
Assets and liabilities for each statement of financial position presented are translated at
the closing rate prevailing at the reporting date;
-
Income and expenses for each profit or loss are translated at average exchange rates
for the year, which approximates the exchange rates at the dates of the transactions;
and
-
All resulting exchange differences are taken to the foreign currency translation reserve
within equity.