2009 - TDM Berhad

TDM Berhad (6265-P) 85Notes to the Financial Statements2. Significant Accounting Policies (cont’d.)2.3 Standards and Interpretations issued but not yet effective (cont’d.)Pronouncements effective for financial periods beginning on or after 1 January 2010 (cont’d.)Amendments to FRSs ‘Improvements to FRSs (2009)’ (cont’d.)FRS 123 Borrowing Costs: The defi nition of borrowing costs is aligned with FRS 139 by referring to the use of effective interest rateas a component of borrowing cost.FRS 127 Consolidated and Separate Financial Statements: The amendment clarifi es that when a parent entity accounts for asubsidiary at fair value in accordance with FRS 139 in its separate fi nancial statements, this treatment continues when the subsidiaryis subsequently classifi ed as held for sale.FRS 128 Investments in Associates: The amendment clarifi es that if an associate is accounted for at fair value in accordance with FRS139, only the requirement of FRS 128 to disclose the nature and extent of any signifi cant restrictions on the ability of the associate totransfer funds to the investor in the form of cash or repayment of loans applies. It further clarifi es that an investment in an associateis treated as a single asset for the purpose of impairment testing. Therefore, any impairment loss is not separately allocated to thegoodwill included in the investment balance.FRS 131 Interests in Joint Ventures: The amendment clarifi es that if a joint venture is accounted for ‘at fair value through profi t or loss’,in accordance with FRS 139, only the requirements of FRS 131 to disclose the commitments of the venturer and the joint venture,as well as summary fi nancial information about the assets, liabilities, income and expense will apply.FRS 134 Interim Financial Reporting: Clarifi es that earnings per share is to be disclosed in interim fi nancial reports if an entity is withinthe scope of FRS 133: Earnings per Share.FRS 136 Impairment of Assets: Clarifi es that when discounted cash fl ows are used to estimate ‘fair value less cost to sell’ additionaldisclosure is required about the discount rate, consistent with disclosures required when the discounted cash fl ows are used toestimate ‘value in use’. The amendment further clarifi es that the largest cash-generating unit for group of units to which goodwillshould be allocated for purposes of impairment testing is an operating segment as defi ned in FRS 8.FRS 139 Financial Instruments: Recognition and Measurement: Clarifi es that changes in circumstances relating to derivatives are notreclassifi cations and therefore may be either removed from, or included in, the ‘fair value through profi t or loss’ classifi cation after initialrecognition. It also clarifi es on the scope exemption for business combination contracts. The amendments remove the reference inFRS 139 to a ‘segment’ when determining whether an instrument qualifi es as a hedge and requires the use of the revised effectiveinterest rate when remeasuring a debt instrument on the cessation of fair value hedge accounting. It also provides additional guidanceon determining whether loan prepayment penalties result in an embedded derivatives that needs to be separated. In addition, theamendments state that the gains or losses on a hedged instrument should be reclassifi ed from equity to profi t or loss during theperiod that the hedged forecast cash fl ows impact profi t or loss.IC Interpretation 10: Interim Financial Reporting and ImpairmentThis IC prohibits impairment losses recognised in an interim period on goodwill or investments in equity instruments or fi nancial assetscarried at cost to be reversed at a subsequent balance sheet date.IC Interpretation 14: FRS 119 – The Limit on a Defi ned Benefi t Asset, Minimum Funding Requirements and their InteractionThis IC provides guidance on how to assess the limit, under FRS 119 Employee Benefi ts, on the amount of surplus in a defi ned benefi tscheme that can be recognised as an asset and explains how the minimum funding requirements will affect the defi ned benefi t assetand addresses when minimum funding requirements may give rise to a liability.