MITRA-AnnualReport2011 (1.2MB).pdf - Announcements - Bursa ...

Notes to The Financial Statements (cont’d)
2. SUMMARy of SIGNIfICANT ACCoUNTING polICIES (CoNT’D)
2.3 Significant Accounting policies (cont’d)
2.3.15 Inventories
Inventories are stated at the lower of cost and net realisable value based on the following methods:-
Raw materials for premix First-in-first-out
Medicine and consumables First-in-first-out
Quarry stocks Weighted Average
The cost of raw materials comprises costs of purchase. The cost of finished goods and work-in-progress
comprises raw materials, direct labour, other direct costs and appropriate proportions of production
overheads. The cost of unsold properties comprises cost associated with the acquisition of land, direct costs
and appropriate proportions of common costs.
Net realisable value is the estimated selling price in ordinary course of business less the estimated costs to
completion and estimated costs necessary to make the sale.
2.3.16 Cash and Cash Equivalents
For the purposes of the statements of cash flows, cash and cash equivalents include cash in hand and at
bank, deposits at call and short term highly liquid investments which subject to an insignificant risk of
changes in value, net of outstanding bank overdrafts.
2.3.17 financial liabilities
Financial liabilities are classified according to the substance of the contractual arrangements entered into
and the definition of a financial liability.
Financial liabilities, within the scope of FRS 139, are recognised in the statement of financial position when,
and only when, the Group and the Company become a party to the contractual provisions of the financial
instrument. Financial liabilities are classified as either financial liabilities at fair value through profit or loss
or other financial liabilities.
(i) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss includes financial liabilities held for trading and
financial liabilities designated upon initial recognition as at fair value through profit and loss.
Financial liabilities held for trading include derivatives entered into by the Group and the Company
that do not meet the hedge accounting criteria. Derivative liabilities are initially measured at fair value
and subsequently stated at fair value, with any resultant gains or losses recognised in profit or loss.
Net gains or losses on derivatives include exchange differences.
The Group and the Company has not designated any financial liabilities as at fair value through profit
or loss.
(ii) Other financial liabilities
The Group’s and the Company’s other financial liabilities include trade payables, other payables and
loans and borrowings.
Trade and other payables are recognised initially at fair value plus directly attributable transaction
costs and subsequently measured at amortised cost using the effective interest method. Borrowings
are classified as current liabilities unless the Company has an unconditional right to defer settlement
of the liability for at least 12 months after the end of the reporting period.
MITRAJAYA HOLDINGS BERHAD ANNUAL REPORT 2011
55