Page 184 - SC SCAR 2023 ENGLISH Flipbook

PART 5 ORGANISATION INFORMATION
(b) Basis of measurement
The financial statements have been prepared on the historical cost basis other than as disclosed in Note 3.
(c) Functional and presentation currency
These financial statements are presented in Ringgit Malaysia (RM), which is the SC’s functional currency. All financial information is presented in RM and has been rounded to the nearest thousand, unless otherwise stated.
(d) Use of estimates and judgements
The preparation of the financial statements in conformity with MFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.
There are no significant areas of estimation uncertainty and critical judgements in applying accounting policies that have significant effect on the amounts recognised in the financial statements other than the following:
(i) Post-employment benefits
For the annual actuarial valuation, the provision is determined using actuarial valuation prepared by an independent actuary. The actuarial valuation involved making assumptions about discount rate, medical inflation rate and life expectancy. As such, the estimated provision amount is subject to significant uncertainty. The assumptions used to estimate the provision are as disclosed in Note 13.
(ii) Deferred tax asset recognition
During the financial year, the SC was granted a 5-year tax exemption from Year Assessment (YA) 2022 until YA 2026. Accordingly, the utilisation of the unabsorbed capital allowance and unutilised tax losses against SC’s business income are not certain. In this connection, the deferred tax asset is derecognised in financial year 2023.
(iii) Capitalising of expenditure in technology related assets
The SC has undertaken the technology transformation plan which involves the purchase of computer hardware, software and developing applications. The development costs that were directly attributable to bringing the asset to its intended use is capitalised whereas the expenses incurred during the research stage were expensed off accordingly.
(iv) Estimated useful lives of identified assets
In view of the phased implementation of the technology transformation plan, the estimated useful lives of the newly acquired computer hardware and system are estimated at 5 years as disclosed in Note 3(b)(iii).
182 SECURITIES COMMISSION MALAYSIA ANNUAL REPORT 2023