LEEKEE INDUSTRIES (M) SDN - teo seng capital berhad

TEO SENG CAPITAL BERHAD
(Incorporated In Malaysia)
Company No : 732762 - T
NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2011
4. ACCOUNTING POLICIES AND STANDARDS (CONT’D)
4.2 Summary of Significant Accounting Policies (Cont’d)
(g)
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is
determined on the weighted average or first-in-first-out bases, as applicable.
Layer and pullet inventories are stated at cost (determined on “weighted-average”
method) adjusted for amortisation (calculated based on their economic egg-laying
lives less net realisable value). Costs of layer and pullet inventories comprise the
original purchase price plus growing cost, which include costs of raw materials, direct
labour and a proportion of farm overheads.
Costs of eggs include costs of raw materials, direct labour and an appropriate
proportion of farm overheads. Costs of egg trays and work-in-progress comprise the
costs of raw materials, direct labour and a proportion of factory overheads.
Costs of poultry feeds, trading merchandise, raw materials (determined on “first-infirst-out”
method), consumable supplies and medication (determined on “weightedaverage”
method), comprise the original purchase price plus the costs incurred in
bringing the inventories to their present location and condition.
Net realisable value represents the estimated selling price in the ordinary course of
business less selling and distribution costs and all other estimated costs to
completion.
Where necessary, due allowance is made for all damaged, obsolete and slow
moving items.
(h)
Financial instruments
Financial instruments are recognised in the statements of financial position when the
Group has become a party to the contractual provisions of the instruments.
Financial instruments are classified as liabilities or equity in accordance with the
substance of the contractual arrangement. Interest, dividends, gains and losses
relating to a financial instrument classified as a liability, are reported as an expense
or income. Distributions to holders of financial instruments classified as equity are
charged directly to equity.
Financial instruments are offset when the Group has a legally enforceable right to
offset and intends to settle either on a net basis or to realise the asset and settle the
liability simultaneously.
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