Page 132 - SC Annual Report 2018 (ENG)

Securities
Commission
Malaysia
ANNUAL
REPORT
2018

(ii) Measurement of expected credit loss (ecL) and fair value of financial instrument

The measurement of ECL and fair value of financial instrument involved making
assumptions about probability of default and loss given default. As such, this estimated
amount is subject to significant uncertainty. The assumptions used to estimate the
amount are as disclosed in Note 19.

2. significant accounting policies

The accounting policies set out below have been applied consistently to the periods presented in these
financial statements, and have been applied consistently by the SC, unless otherwise stated.

Arising from the adoption of MFRS 15, Revenue from Contracts with Customers and MFRS 9, Financial
Instruments, there are changes to the accounting policies of:

(i) financial instruments;
(ii) revenue recognition; and
(iii) impairment losses of financial instruments

as compared to those adopted in previous financial statements. There are no significant impact from
adoption of MFRS 15. The impact arising from adoption of MFRS 9 is disclosed in Note 21.

(a) Financial instruments

Unless specifically disclosed below, the SC generally applied the following accounting policies
retrospectively. Nevertheless, as permitted in MFRS 9, Financial Instruments, the SC has elected
not to restate the comparatives.

(i) Recognition and initial measurement

A financial asset or a financial liability is recognised in the statement of financial position
when, and only when, the SC becomes a party to the contractual provisions of the
instrument.

current financial year

A financial asset or a financial liability is initially measured at fair value plus or minus,
for an item not at fair value through profit or loss, transaction costs that are directly
attributable to its acquisition or issuance. A trade receivable without a significant
financing component is initially measured at the transaction price.

An embedded derivatives is recognised separately from the host contract where the
host contract is not a financial asset, and accounted for separately if, and only if, the
derivatives is not closely related to the economic characteristics and risks of the host
contract and the host contact is not measured at fair value through profit or loss. The host
contract, in the event an embedded derivatives is recognised separately, is accounted for
in accordance with policy applicable to the nature of the host contract.

122 | PART 5 »» STATEMENTS, STATiSTiCS ANd ACTiviTiES

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