continued - The Lion Group

3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(e) Foreign Currencies (continued)
(iii) Foreign Operations
The results and financial position of foreign operations that have a functional currency different from
the presentation currency (RM) of the consolidated financial statements are translated into RM as
follows:
- Assets and liabilities for each balance sheet presented are translated at the closing rate prevailing
at the balance sheet date;
- Income and expenses for each income statement are translated at average exchange rates for
the year, which approximate the exchange rates at the dates of the transactions; and
- All resulting exchange differences are taken to the foreign currency translation reserve within
equity.
Goodwill and fair value adjustments arising from the acquisition of foreign operations are treated
as assets and liabilities of the foreign operations and are recorded in the Functional Currency of the
foreign operations and translated at the closing rate at the balance sheet date.
The principal closing rates used in translation of foreign currency amounts are as follows:
48
2010 2009
RM RM
1 USD 3.27 3.53
1 Euro 3.98 4.98
1 Singapore Dollar 2.33 2.43
1 Sterling Pound 4.92 5.86
1 Swiss Franc 3.06 3.26
1 Swedish Krona 0.44 0.46
(f) Impairment of Assets
The carrying amounts of the assets, other than inventories, and financial assets (other than investment in
subsidiaries and associates) are reviewed to determine whether there is any indication of impairment.
Impairment is measured by comparing the carrying amounts of the assets with their recoverable amounts.
The recoverable amount is the higher of an asset’s net selling price and its value-in-use, which is measured
by reference to the present value of estimated future cash flows. Recoverable amounts are estimated for
individual assets, or if it is not possible, for the cash-generating unit.
Impairment loss is recognised as an expense in the income statement, unless the asset is carried at a
revalued amount, in which case the impairment loss is used to reduce the revaluation surplus to the extent
of previously recognised revaluation surplus for the same asset.
An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying
amount that would have been determined, net of depreciation or amortisation, if no impairment loss has
been recognised. The reversal is recognised in the income statement, unless it reverses an impairment loss
on a revalued asset, in which case it is taken to equity.
An impairment loss in respect of goodwill is not reversed unless the loss was caused by a specific external
event of an exceptional nature that is not expected to recur and subsequent external events have occurred
that reversed the effect of that event.