BERJAYA GROUP BERHAD - Berjaya Corporation Berhad

80
N O T E S T O T H E A C C O U N T S
30 APRIL 1998
2 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(e)
Income recognition (continued)
(ii) Insurance (continued)
The insurance results are determined after taking full account, inter alia, of unexpired risks and
outstanding claims.
(iii)Development properties
Profit from the sale of development properties is recognised on the ‘percentage of completion’
method. Anticipated losses are recognised immediately in the profit and loss account.
(iv)Dividend income
Dividend income from investments in subsidiary and associated companies is accounted for on the
accrual basis. Income from other investments is accounted for on the receipt basis and, in the case
of an insurance subsidiary, on the basis of the dates dividends are declared by the investee
companies.
(v) Brokerage fees and commissions
Income from brokerage is recognised upon execution of contracts while underwriting commission is
recognised upon completion of the corporate exercises concerned.
(vi)Entrance fees
Entrance fees from members joining the resorts and recreation clubs are recognised on the accrual
basis. Where the main facilities are not immediately available for members’ use, only a portion of
the entrance fees calculated in proportion to those facilities available is recognised and the
remaining portion deferred until the main facilities are ready.
(vii) Enrolment fees
80% of the enrolment fees from members joining the vacation club are recognised as income upon
signing of the membership agreement and the remaining 20% is treated as deferred membership
fees which are recognised over the membership period.
(viii) Sale of consumer durables
Sales are recognised upon the delivery of products and revenue from incidental services rendered
are recognised upon its completion. Revenue from hire purchase sales is arrived at after adjusting for
the net increase or decrease in unearned carrying charges calculated on a straight-line basis.
Interest income from equal payment scheme is accrued for when sales are made and recognised
when instalment payments are received.
(f)
Currency conversion and translation
Transactions in foreign currencies during the year are converted into Ringgit Malaysia at rates of
exchange approximating those ruling at the transaction dates or at contracted rates, where applicable.
Foreign currency monetary assets and liabilities at the balance sheet date are translated into Ringgit
Malaysia at rates of exchange approximating those ruling at that date or at contracted rates, where
applicable. All exchange gains or losses are dealt with in the profit and loss accounts.
The accounts of foreign subsidiary companies have been translated into Ringgit Malaysia at the rate of
exchange ruling at the balance sheet date. Exchange differences on translation of the net assets of
foreign subsidiary companies are dealt with through an exchange fluctuation reserve.
(g)
Investments
Investments in subsidiary, associated companies and other long term investments are stated at cost. Such
investments are only written down when the directors are of the opinion that there is permanent
diminution in their value.
Investment of the unit-linked business are stated at market value. Any increase or decrease in value of
investment is taken to the revenue account.
Malaysian Government Securities and Cagamas Bonds are stated at cost adjusted for amortisation of
premiums and accretion of discounts, where applicable, to their respective maturity dates.