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Annual Report 2020
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Notes to the Financial Statements
As at 31 March 2020
kumpulan Fima Berhad
(197201000167)(11817-V)
2.
Significant accounting policies (cont’d.)
2.4 Summary of significant accounting policies (cont’d.)
(l)
Provisions for liabilities (cont’d.)
(i)
Warranty claim
The Group has contracts with government agencies for the supply of security and confidential
documents. Under these contracts, the Group provides warranty for after defect products claimable
within 3 to 5 years from the point of sales.
(m) Employee benefits
(i)
Short term benefits
Wages, salaries, bonuses and social security contributions are recognised as an expense in the year
in which the associated services are rendered by employees of the Group and of the Company. 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, and short
term non-accumulating compensated absences such as sick leave are recognised when the absences
occur.
(ii) Defined contribution plan
As required by law, companies in Malaysia make contributions to the national pension scheme, the
Employees Provident Fund ("EPF"). Such contributions are recognised as an expense in the profit or
loss as incurred.
(iii) Defined benefit plan
The foreign subsidiary in Indonesia, operates an unfunded, defined benefit Retirement Benefit Scheme
(“the Scheme”) for its eligible employees. The foreign subsidiary’s obligation under the Scheme,
calculated using the Projected Unit Credit Method, is determined based on actuarial assumptions by
independent actuaries, through which the amount of benefit that employees have earned in return for
their services in the current and prior years is estimated. That benefit is discounted in order to determine
its present value. Actuarial gains and losses are recognised immediately through other comprehensive
income in order for the net pension assets or liability recognised in the consolidated statement of
financial position to reflect the full value of the plan deficit or surplus. Past service costs are recognised
immediately to the extent that the benefits are already vested, and otherwise are amortised on a
straight-line basis over the average period until the amended benefits become vested.
The amount recognised in the statement of financial position represents the present value of the defined
benefit obligations adjusted for unrecognised past service costs, and reduced by the fair value of plan
assets. Any asset resulting from this calculation is limited to the net total of any past service costs, and
the present value of any economic benefits in the form of refunds or reductions in future contributions
to the plan.
The latest actuarial valuation was carried out using the employee data as at 31 March 2020 by PT Sentra
Jasa Aktuaria, an independent actuary report dated 11 June 2020.