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Notes to the

Financial Statements

As at 31 March 2019

2.

Significant accounting policies (cont’d.)

2.3 Summary of significant accounting policies (cont’d.)

(g) Property, plant and equipment and depreciation (cont’d.)

Other property, plant and equipment is depreciated on a straight-line basis to write-off the cost of

each asset to its residual value over the estimated useful life, at the following annual rates:

Buildings

2.0% - 10.0%

Leasehold land

Over lease period

Plant and machinery

4.0% - 50.0%

Bearer plant and infrastructure

4.0%

Fish canning facilities

2.0%

Warehouses, storage tanks and pipelines

4.0%

Motor vehicles

10.0% - 33.33%

Office equipment, furniture and fittings

6.66% - 25.0%

Renovations

4.0% - 20.0%

Tools, accessories and computer equipment

20.0% - 33.33%

Assets under construction or capital work-in-progress included in property, plant and equipment are

not depreciated as these assets are not yet available for use. Immature plantations, which in general

are mature 36 months after field planting are not depreciated until maturity.

The carrying values of property, plant and equipment are reviewed for impairment when events or

changes in circumstances indicate that the carrying value may not be recoverable.

The residual value, useful life and depreciation method are reviewed at each financial year-end, and

adjusted prospectively if appropriate.

An item of property, plant and equipment is derecognised upon disposal or when no future economic

benefits are expected from its use or disposal. Any gain or loss on derecognition of the asset is

included in the profit or loss in the year the asset is derecognised.

(h) Biological assets

Biological assets comprise produce growing on bearer plants. Biological assets are classified as

current assets for bearer plants that are expected to be harvested and sold or used for production

on a date not more than 15 days after the reporting date.

Biological assets are measured at fair value less costs to sell. Any gains or losses arising from changes

in the fair value less costs to sell are recognised in profit or loss. Fair value is determined based on

the present value of expected net cash flows from the biological assets. The expected net cash flows

are estimated using the expected output (FFB harvest) and market price at reporting date of crude

palm oil and palm kernel adjusted for extraction rates less processing, harvesting and transportation

costs.

Kumpulan Fima Berhad

(11817-V)

Annual Report 2019

134