1.

0 INTRODUCTION
Financial Reporting Standards (FRS) was first implement on 1 January 2006 and with effect from that day all reporting entities in Malaysia are required to prepare their financial statement in accordance with the adopted new and improved Financial Reporting Standards. Financial Reporting Standard (FRS) is a standard required to be followed by all the listed company in Malaysia when preparing the annual financial report to ensure that all the information are being disclose in a suitable way and understandable by the public. To help our capital markets have become globally, FRS has improved to equivalent to International Financial Reporting Standard (IFRS) which will help to place Malaysian business on a level playing field with its international counterparts.

Our analysis involved FRS 3 (Business Combination) which is FRS 117 Lease, FRS 136 Impairment of Assets, FRS 138 Intangible Assets, and FRS 140 Investment Property. We have randomly selected 3 public companies (in the same industry) listed in Bursa Malaysia to do analyze on their accounting treatment, especially in the presentation and disclosure part. We have chosen Kretam Holdings Bhd, Sarawak Plantation Bhd, and Genting Plantations Berhad to study the disclosure of FRS listed above and analyzes the compliance level of each of the companies.

To calculate for the level of compliance, we will use this formula

level of compliance =

number of ticks number of item under frs less number of item unrelated to the company

BACKGROUND OF COMPANY Kretam Holdings Bhd

KRETAM HOLDING BERHAD (KHB) was listed on the Bursa Malaysia Main Board (Plantation Sector) on 18th January 1989. The KHB Group is involved in investment holding, oil palm cultivation, milling and sale of oil palm products, provision of plantation & palm oil mill management including services and stock broking. KHB group head office is located at Sandakan town while the plantation division being its core business is located at Sandakan & Tawau area. Syarikat Kretam Mill Sdn Bhd, one of KHB's subsidiaries, owns and operates a palm oil mill at Mile 44 Sandakan - Lahad Datu highway near Bukit Garam, Kinabatangan. We are planning to construct a new palm oil mill at Sg. Silimpopon in Kalabakan, Tawau in 2010. The Vision and Mission of Kretam Holdings Bhd is to become the best innovative, nature friendly and Profitable Companys in this industry. The career opportunity for this company is looking for suitably qualified candidates for the positions in jobs.

BACKGROUND OF COMPANY Sarawak Plantation (SPB)

Sarawak Plantation (SPB) was incorporated in Malaysia on 28 October 1997 as a private limited company under the name of Sarawak Plantation Sdn. Bhd. and commenced business in the same year. SPB was converted into a public company on 1 February 2000 and assumed its present name. SPB was specially incorporated as the vehicle company for the privatization of Sarawak Land Development Boards (SLDB) assets. SPB is the only oil palm seed producer in Sarawak and it owns and operates a seed garden. Its current annual production is around 1.4 million seeds and it targets to produce 5 million high quality seeds by 2014. These high quality seeds are certified by SIRIM and are licensed for sale by the Malaysian Palm Oil Board (MPOB). Apart from providing seeds for internal use, SPB also sells its seeds to other plantations and smallholders. The core business activities of the SPB Group are: Development, cultivation and management of oil palm plantations on a large scale Milling of fresh fruit bunches (FFB) into crude palm oil (CPO) and palm kernel (PK). Plantation management services. Strategic investment to develop NCR land into oil palm plantations. Operation of a seed garden supplying high yielding seeds and seedlings. Providing laboratory and technical services for the oil palm industry.

BACKGROUND OF COMPANY Genting Plantations Berhad

Genting Plantations Berhad ("Genting Plantations"), formerly known as Asiatic Development Berhad, is one of the fastest growing plantation companies listed on the Main Board of Bursa Malaysia (formerly known as Kuala Lumpur Stock Exchange). Incorporated in Malaysia as a private limited company on 29 September 1977, under the name of Asiatic Development Sdn Bhd, it became a wholly owned subsidiary of Genting Berhad ("Genting") on 22 February 1980 to spearhead Genting's plantation business. Genting Plantations currently has about 133,000 hectares of plantation land (compared to 41,000 hectares in 2000) in Malaysia and Indonesia. Since its inception, Genting Plantations has established itself as a reputable and reliable palm oil producer as well as one of the lowest-cost palm oil producers in Malaysia. Whilst the plantation business remains its core activity, Genting Plantations has also ventured into property development. The first project by Genting Plantations's property arm, Genting Property Sdn Bhd is the 55-hectare Genting Cheng Perdana in Central Melaka, which is near the tail-end of development. Its second project is the 284-hectare Genting Permaipura in Kedah. Located in the northern part of Malaysia near the town of Sungei Petani, this comprehensive township offers a mix of commercial properties, bungalow lots, residential houses and an 18-hole golf course with a clubhouse, The Genting Permaipura Golf & Country Club. Genting Pura Kencana Sri Gading is the newest real estate project from Genting Property and is located near the town of Batu Pahat. This project can be easily reached from Malaysias most comprehensive highway, the NorthSouth Expressway, and is located near amenities such as a hypermarket, malls and tertiary institutions. Genting Plantations has also boldly ventured into the biotechnology industry. In 2007, the company through subsidiary ACGT Sdn Bhd entered into a joint venture with US-based Synthetic Genomics, Inc. In line with its aim to be a world-class centre of excellence in genomic science in Malaysia, ACGT is receiving technical assistance from the highly acclaimed US-based J. Craig Venter Institute to explore the use of genomics-based techniques to improve yields and profit streams of oil palm.

COMPLIANCE LEVEL OF THE COMPANY FRS 117 LEASE

The objective of this Standard is to prescribe, for lessees and lessors, the appropriate accounting policies and disclosure to apply in relation to leases. This Standard shall be applied in accounting for all leases other than: a. Leases to explore for or use minerals, oil, nature gas abd and similar non-regenerative

resources. b. Licensing agreements for such items as motion picture films, video recordings, manuscripts, patents and copyright. This Standard applies to agreements that transfer the right to use assets even though substantial services by the lessor or may be called for in connection with the operation or maintenance of such assets. This Standard does not apply to agreements that are contracts for services that do not transfer the right to use assets from one contracting party to the other. FRS 117 (Para35) Disclosure in the financial statements of lessees (Operating leases)

Disclosure Requirement
1) The total of future minimum lease payments under non-cancellable operating leases for each of the following periods: Not later than one year; Later than one year but not more than five years; and Later than five years; 2) The total of future minimum sublease payments expected to be received under noncancellable subleases at the balance sheet date

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd

3) Lease and sublease payments recognized in the profit and loss account for the period, with separate amounts for minimum lease payments, contingent rents, and sublease payments 4) A general description of the leassees significant leasing arrangements including, but not limited to, the following: The basis on which contingent rent payments are determined; The existence and terms of renewal or purchase options and escalation clauses; and Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing.

FRS 117 (Para 31) Disclosure in the financial statements of lessees (Finance leases)

Disclosure Requirement
1) The net carrying amount of each major class of leased assets at the balance sheet date 2) A reconciliation of the minimum lease payments at the balance sheet and their present value

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd X

3) The total of minimum lease payments at the balance sheet date, and their present value, for each of the following period: Not later than one year Later than one year but not more than five years; Later than five years. 4) Contingent rest recognized in the profit and loss account for the period 5) The total of future minimum sublease payments expected to be received under noncancellable subleases at the balance sheet date 6) A general description of the lessees significant leasing arrangements including, but not limited to the following: The basis on which contingent rent payments are determined; The existence and terms of renewal or purchase options and escalation clauses; and Restrictions imposed by lease agreements, such as those concerning dividends, additional debts, and further leasing.

NIL

FRS 117 (Para 56 & 57) Disclosure in the financial statements of lessors (Operating leases)

Disclosure Requirement
1) The future minimum lease payments under noncancellable operating leases in the aggregate and for each of the following periods: Not later than one year; Later than one year but not more than five years; and Later than five years 2) Total contingent rents recognised for the period. 3) A general description of significant leasing arrangements. 4) Para 57 of FRS 117, for assets leased out under operating leases, the disclosure of: The gross carrying amount; The accumulated depreciation; The accumulated impairment losses; The depreciation charge of the period; The impairment losses recognised for the period; and The impairment losses reversed for the period.

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd

X X

FRS 117 (Para 45) Disclosure in the financial statements of lessors (Finance leases)

Disclosure Requirement
1) A reconciliation between the gross investment in the lease at the balance sheet date and the present value of the minimum lease payments receivable at the balance sheet date 2) The total gross investment in the lease and the present value of the minimum lease payments receivable at the balance sheet date, for each of the fallowing periods: Not later than one year; Later than one year but not more than five years; Later than five years; 3) Unearned finance income 4) The unguaranteed residual values accruing to the benefit of the lessor 5) The accumulated allowance for uncollectible lease receivable 6) Contingent rents recognized in income for the period 7) A general description of significant leasing arrangements

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd

NIL X X

NIL X X NIL

X X X X

Kretam Holdings Bhd

FRS 117 (Para35) Disclosure in the financial statements of lessees (Operating leases) 1. The total of future minimum lease payments under non-cancellable operating leases for each of the following periods: Not later than one year; Later than one year but not more than five years; and Later than five years.

3. Lease and sublease payments recognized in the profit and loss account for the period, with separate amounts for minimum lease payments, contingent rents, and sublease payments.

4. A general description of the leassees significant leasing arrangements including The existence and terms of renewal or purchase options and escalation clauses.

The total of future minimum sublease payments expected to be received under noncancellable subleases at the balance sheet date in FRS 117 Para 35 should be disclosure, but the Kreatam Holdings Bhd do not prepared it.

FRS 117 (Para 31) Disclosure in the financial statements of lessees (Finance leases) 1. The net carrying amount of each major class of leased assets at the balance sheet date.

2. A reconciliation of the minimum lease payments at the balance sheet and their present value.

3. The total of minimum lease payments at the balance sheet date, and their present value, for each of the following period: Not later than one year Later than one year but not more than five years; Later than five years.

5. The total of future minimum sublease payments expected to be received under noncancellable subleases at the balance sheet date. 6. A general description of the lessees significant leasing arrangements including The existence and terms of renewal or purchase options and escalation clauses

FRS 117 (Para 56 & 57) Disclosure in the financial statements of lessors (Operating leases) 1. The future minimum lease payments under non-cancellable operating leases in the aggregate and for each of the following periods: Not later than one year; Later than one year but not more than five years; and Later than five years

2. Total contingent rents recognised for the period.

2.27 Revenue

3. A general description of significant leasing arrangements.

Para 57 of FRS 117, for assets leased out under operating leases also did not disclosure the gross carrying amount.

FRS 117 (Para 45) Disclosure in the financial statements of lessors (Finance leases) 6. Contingent rents recognized in income for the period. 7. A general description of significant leasing arrangements.

Kretam holdins Bhd dont have any unearned finance income.

Sarawak Plantation (SPB)

FRS 117 (Para 31) Disclosure in the financial statements of lessees (Finance leases) 1. The net carrying amount of each major class of leased assets at the balance sheet date.

5. Contingent rest recognized in the profit and loss account for the period.

6. A general description of the lessees significant leasing arrangements including, but not limited to the following: The basis on which contingent rent payments are determined; The existence and terms of renewal or purchase options and escalation clauses; and Restrictions imposed by lease agreements, such as those concerning dividends, additional debts, and further leasing.

FRS 117 (Para 45) Disclosure in the financial statements of lessors (Finance leases) 7. A general description of significant leasing arrangements.

Genting Plantations Berhad

FRS 117 (Para 56 & 57) Disclosure in the financial statements of lessors (Operating leases) 2. The Group does not recognise a contingent liability but discloses its existence in the financial statements, except in a business combination. No contingent or other liability of the Group or of the company has become enforceable, or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinion of the Directors, will or may substantially affect the ability of the Group or of the Company to meet their obligations as and when they fall due. The Group does not recognise a contingent liability but discloses its existence in the financial statements, except in a business combination.

3. A general description of significant leasing arrangements.

FRS 117 (Para 45) Disclosure in the financial statements of lessors (Finance leases) 2. The total gross investment in the lease and the present value of the minimum lease payments receivable at the balance sheet date, for each of the fallowing periods: Not later than one year in year 2010; Later than one year but not more than five years in year 2009.

7. A general description of significant leasing arrangements.

Level of Compliance for FRS 117

FRS 117
70 60 50 40 30 20 10 0 Kretam Holding Sarawak Plantation Genting Plantation Percentage %

As we can see from above, Kretam Holding has the highest level of compliance among the company that we have studied with 65%, followed by Genting Plantation with 19% level of compliance. The Sarawak Plantation has the lowest level of compliance with 16.7%.

COMPLIANCE LEVEL OF THE COMPANY FRS 136 IMPAIRMENT OF ASSETS

The objective of this Standard is to prescribe the procedures that an entity applies to ensure that its assets are carried at no more that their recoverable amount. An asset is carried at more than recoverable amount if its carrying amount exceeds the amount to be recovered though use or sales of the asset. If this is the case, the asset is described as impaired and the Standard requires the entity to recognize an impairment loss. The Standard also specified when an entity should reverse an impairment loss and prescribes disclosures FRS 136 prescribes accounting and disclosure for impairment of assets. The objective is mainly to ensure that assets are not carried in the balance sheet at amounts higher than their recoverable amounts. Where there is impairment loss or reversal of impairment loss for the period, FRS 136, Para 126 require the following disclosures for each class of assets: FRS 136 (Para126) Impairment loss or reversal of impairment loss for the period

Disclosure Requirement
1) The amount of impairment losses recognized in profit or loss during the period and the line item of the income statement in which those impairment losses are included. 2) The amount of reversals of impairment losses recognized in profit or loss during the period and the line item of the income statement in which those impairment losses are reversed. 3) The amount of impairment losses recognized directly in equity during the period. 4) The amount of reversals of impairment losses recognized directly in equity during the period.

Kretam Holdings Bhd

Sarawak Genting Plantation(SPB) Plantations Bhd

NIL

X X

Kretam Holdings Bhd

FRS 136 (Para126) Impairment loss or reversal of impairment loss for the period

3. The amount of impairment losses recognized directly in equity during the period.

The amount of impairment losses is not recognized in profit or loss during the period, but is recognized at Statement of Changes of Equity and the line items of impairment losses are not included.

The amount of reversals of impairment losses is not recognized in profit or loss or in equity during the period. That are recognized at Statement of Cash Flows, and the line item for allowance for impairment and reversal of impairment looses is stated in above notes.

Sarawak Plantation (SPB)

FRS 136 (Para126) Impairment loss or reversal of impairment loss for the period 1) The amount of impairment losses recognized in profit or loss during the period and the line item of the income statement in which those impairment losses are included.

2) The amount of reversals of impairment losses recognized in profit or loss during the period and the line item of the income statement in

Genting Plantations Berhad

FRS 136 (Para126) Impairment loss or reversal of impairment loss for the period (1) and (3) impairment losses recognised in profit or loss on equity instruments classified as available for sale are reversed through other comprehensive income and not through profit or loss.

Here are the explanation and amount of impairment loss for (1) and (3).

Level of Compliance with FRS 136

FRS 136
60

50

40

30

Percentage%

20

10

0 Kretam Holding Sarawak Plantation Genting Plantation

As we can see from above, the level of compliance with frs 136 is the highest in the Genting Plantation company with 50%, followed by Sarawak Plantation with 33%. The lowest level of compliance goes to the Kretam Holding with 20%.

COMPLIANCE LEVEL OF THE COMPANY FRS 138 Intangible Assets

The objective of this Standard is to prescribe the accounting treatment for intangible assets that are not dealt with specifically in another Standard. This Standard requires an entity to recognize intangible assets if, and only if, specified criteria are met. The Standard also specie how to measure the carrying amount of intangible assets and requires specifies disclosures about intangible assets. This Standard shall be applied in accounting for intangible assets, except: a. Intangible assets that are within the scope of another Standard. b. Financial assets, as defined in FRS 139 Financial Instruments: Recognition and Measurement. c. The recognition and measurement of exploration and evaluation assets (see IFRS 6) Exploration for and Evaluation of Mineral Resources. d. Expenditure on the development and extraction of, mineral, oil natural gas and similar non- regeneration resources.

FRS 138 (Para 118) Class of intangible assets, distinguishing between internally generated intangible assets and other intangible asset

Disclosure Requirement
1) Whether the useful are finite or indefinite, and if finite, the useful lives or the amortisation rates used. 2) The amortisation methods used for intangible assets with finite useful lives. 3) The gross carrying amount and the accumulated amortization (aggregated with accumulated impairment losses) at the beginning and end of the period.

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd X

4) The line item of the income statement in which the amortisation of assets included. 5) A reconciliation of the carrying amount at the beginning and end of the period. Additions, indicating separately those from internal development, those acquired separately and those acquired through business combinations; Assets classified as held for sale, and other disposals; Increases or decreases during the period resulting from revaluations and from impairment losses recognized or reversed directly in equity; Impairment losses recognized in the income statement during the period under FRS 136; Impairment losses reversed in the income statement during the period under FRS 136; Any amortization recognised during the period; Net exchange differences arising on the translation of the financial statements of a foreign entity; and Other changes in the carrying amount during the period.

FRS 138 (Para 122) Additional disclosure requirement

Disclosure Requirement
1) For an intangible asset assessed as having an indefinite useful life, the carrying amount of that asset and the reasons supporting the assessment of an indefinite useful life. In giving these reasons, the entity shall describe the factor(s) that played a significant role in determining that the asset has an indefinite useful life. 2) A description, the carrying amount and remaining amortisation period of any individual intangible asset that is material to the entity's financial statements. 3) For intangible assets acquired by way of a government grant and initially recognized at fair value: The fair value initially recognized for these assets; Their carrying amount; and Whether they are measured after recognition under the cost model or the revaluation model. 4) The existence and carrying amounts of intangible assets whose title is

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd

NIL

restricted and the carrying amounts of intangible assets pledged as security for liabilities. 5) The amount of contractual commitments for the acquisition of intangible assets.

NIL

FRS 138 (Para 124) Additional disclosure for intangible assets are carried at revalued amounts

Disclosure Requirement
1) By class of intangible assets: a) The effective date of the revaluation; b) The carrying amount of revalued intangible assets; and c) The carrying amount that would have been included in the financial statements had the revalued intangible assets been measured using the cost model. 2) The amount of the revaluation surplus that relates to intangible assets at the beginning and end of the period, indicating the changes during the period and any restrictions on the distribution of the balance to shareholders. 3) The methods and significant assumptions applied in estimating the assets fair values.

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd

NIL

Kretam Holdings Bhd

FRS 138 (Para 118) Class of intangible assets, distinguishing between internally generated intangible assets and other intangible asset 1. Whether the useful are finite or indefinite, and if finite, the useful lives or the amortisation rates used. 2. The amortisation methods used for intangible assets with finite useful lives. 3. The gross carrying amount and the accumulated amortization (aggregated with accumulated impairment losses) at the beginning and end of the period.

5. A reconciliation of the carrying amount at the beginning and end of the period. Additions, indicating separately those from internal development, those acquired separately and those acquired through business combinations; Assets classified as held for sale, and other disposals; Increases or decreases during the period resulting from revaluations and from impairment losses recognized or reversed directly in equity; Impairment losses recognized in the income statement during the period under FRS 136; Impairment losses reversed in the income statement during the period under FRS 136; Any amortization recognised during the period; Net exchange differences arising on the translation of the financial statements of a foreign entity; and Other changes in the carrying amount during the period.

The line item of the income statement in which the amortisation of assets are not included in annual report for Kretam Holdings Bhd.

FRS 138 (Para 122) Additional disclosure requirement 1. For an intangible asset assessed as having an indefinite useful life, the carrying amount of that asset and the reasons supporting the assessment of an indefinite useful life. In giving these reasons, the entity shall describe the factor(s) that played a significant role in determining that the asset has an indefinite useful life.

3. For intangible assets acquired by way of a government grant and initially recognized at fair value: The fair value initially recognized for these assets; Their carrying amount; and Whether they are measured after recognition under the cost model or the revaluation model.

5. The amount of contractual commitments for the acquisition of intangible assets.

FRS 138 (Para 124) Additional disclosure for intangible assets are carried at revalued amounts 1. By class of intangible assets: d) The effective date of the revaluation; e) The carrying amount of revalued intangible assets; and f) The carrying amount that would have been included in the financial statements had the revalued intangible assets been measured using the cost model.

2. The amount of the revaluation surplus that relates to intangible assets at the beginning and end of the period, indicating the changes during the period and any restrictions on the distribution of the balance to shareholders.

Sarawak Plantation (SPB)

FRS 138 (Para 118) Class of intangible assets, distinguishing between internally generated intangible assets and other intangible asset

Genting Plantations Berhad

FRS 138 (Para 118) Class of intangible assets, distinguishing between internally generated intangible assets and other intangible asset 1. Whether the useful are finite or indefinite, and if finite, the useful lives or the amortisation rates used. For finite useful life;

Evidence of amortisation occurred but it did not state the rate of amortisation:

For indefinite useful life

2. Capitalised development costs are recorded as intangible assets and amortised from the point at which the asset is ready for use or sale, on a straight-line basis over useful life, not exceeding twenty years. The amortisation methods used for intangible assets with finite useful lives.

3. The gross carrying amount and the accumulated amortization (aggregated with accumulated
impairment losses) at the beginning and end of the period.

5. A reconciliation of the carrying amount at the beginning and end of the period. (increase in 2010)

FRS 138 (Para 124) Additional disclosure for intangible assets are carried at revalued amounts 2. The amount of the revaluation surplus that relates to intangible assets at the beginning and end of the period.

Level of Compliance with FRS 138

FRS 138
100 90 80 70 60 50 40 30 20 10 0 Kretam Holding Sarawak Plantation Genting Plantation Percentage %

As shown above, Kretam Holding has the highest level of compliance with FRS 138 with a percentage of 90%, followed by Genting Plantation with a percentage of 38%. Sarawak Plantation did not comply at all with FRS138. This is clearly stated in the notes that is included for the financial statement.

COMPLIANCE LEVEL OF THE COMPANY FRS 140 INVESTMENT PROPERTY

The Objective of this Standard is to prescribe the accounting treatment for investment property and related disclosures requirements. FRS 140 defines Investment Property as land or a building or part of building or land and building held (by the owner or under finance lease) to earned rental or for capital appreciation or both. Investment Property: Land held for long -term (>5yrs) capital appreciation-ex land for housing, public utilities etc. land held for undetermined future use - ex remote land for plantation building owned building that is vacant but is held to be leased out under operating leased

FRS 140 (Para 75) For all investment property

Disclosure Requirement
1) Whether the cost model or the fair value model is used. 2) If the fair value model is used, whether, and in what circumstances, property interest held under operating leases are classified and accounted for as investment property. 3) When classification is difficult, the criteria used to identify investment properties. 4) The methods and significant assumptions applied in estimating the fair value of investment property.

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd

NIL

NIL

NIL

5) The extent to which fair value is based on valuation by an independent professional valuer. 6) The amount included in the income statements for: (i) rental income;(ii)direct operating expenses arising from investment property that generate rental income during the period and (iii)direct operating expenses arising from investment property that did not generate rental income during the period. 7) Material contractual obligation.

NIL

NIL

NIL

FRS 140 (Para 79) Additional disclosure requirements for cost model

Disclosure Requirement
1) The depreciation method used. 2) The useful lives or the depreciation rates used. 3) The gross carrying amount and the accumulated depreciation (together with accumulated impairment losses) at the beginning and end of the period. 4) A reconciliation of the carrying amount of investment property at the beginning and end of the period. 5) The fair value of the investment property.

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd

NIL

NIL NIL

FRS 140 (Para 76) Additional disclosure requirements for fair value model

Disclosure Requirement
1) Reconciliation of the carrying amount of investment property at the beginning and end of the period

Kretam Holdings Bhd

Sarawak Genting Plantation (SPB) Plantations Bhd NIL

FRS 140 (Para 78) For investment property the fair value model but its fair value cannot be measured reliably

Disclosure Requirement
1) A description of the property. 2) An explanation why fair value cannot be determined reliably. 3) If possible, the range of estimates within which fair value is highly likely to lie. 4) Upon disposal, the carrying amount and the gain or loss arising there form.

Kretam Holdings Bhd NIL NIL

Sarawak Genting Plantation (SPB) Plantations Bhd NIL NIL NIL NIL NIL X X NIL

Kretam Holdings Bhd

FRS 140 (Para 75) For all investment property 1. Whether the cost model or the fair value model is used.

6. When classification is difficult, the criteria used to identify investment properties. 7. The methods and significant assumptions applied in estimating the fair value of investment property.

FRS 140 (Para 79) Additional disclosure requirements for cost model 1. The depreciation method used. 2. The useful lives or the depreciation rates used.

3. The gross carrying amount and the accumulated depreciation (together with accumulated impairment losses) at the beginning and end of the period. 4. A reconciliation of the carrying amount of investment property at the beginning and end of the period. 5. The fair value of the investment property.

FRS 140 (Para 76) Additional disclosure requirements for fair value model 1. Reconciliation of the carrying amount of investment property at the beginning and end of the period

FRS 140 (Para 78) For investment property the fair value model but its fair value cannot be measured reliably 1. A description of the property.

4. Upon disposal, the carrying amount and the gain or loss arising there form.

Sarawak Plantation (SPB)

FRS 140 (Para 75) For all investment property 1. Whether the cost model or the fair value model is used

5. The extent to which fair value is based on valuation by an independent professional valuer.

6. The amount included in the income statements for: I. II. Rental income Direct operating expenses arising from investment property that generate rental income during the period and III. Direct operating expenses arising from investment property that did not generate rental income during the period.

FRS 140 (Para 79) Additional disclosure requirements for cost model 1. The depreciation method used

2. The useful lives or the depreciation rates used.

3. The gross carrying amount and the accumulated depreciation (together with accumulated impairment losses) at the beginning and end of the period.

4. A reconciliation of the carrying amount of investment property at the beginning and end of the period

5. The fair value of the investment property.

Genting Plantations Berhad

FRS 140 (Para 75) For all investment property 1. Whether the cost model or the fair value model is used. (Both) Cost Model:

Fair Model

3. Investment properties under construction before 1 January 2010 were classified as property, plant and equipment and measured at cost. Following to the amendment made to FRS 140, such properties are treated as investment property and accounted as such retrospectively. When classification is difficult, the criteria used to identify investment properties.

4.

The fair values of the investment properties were based on valuation by independent professional qualified valuers. Valuations were based on sales of comparable properties in the vicinity. The methods and significant assumptions applied in estimating the fair value of investment property.

5.

The fair values of the investment properties were based on valuation by independent professional qualified valuers. Valuations were based on sales of comparable properties in the vicinity. The extent to which fair value is based on valuation by an independent professional valuer.

6.

The amount included in the income statements for: (i) rental income; (ii)direct operating expenses arising from investment property that generate rental income during the period

FRS 140 (Para 79) Additional disclosure requirements for cost model 1. Depreciation for other investment properties is calculated using the straight-line method to allocate their costs over their estimated useful lives. The depreciation method used.

2.

The useful lives or the depreciation rates used.

FRS 140 (Para 76) Additional disclosure requirements for fair value model 1. Reconciliation of the carrying amount of investment property at the beginning and end of the period,

Level of Compliance with FRS 140

FRS 140
120 100 80 60 40 20 0 Kretam Holding Sarawak Plantation Genting Plantation

Percentage %

As shown above, Kretam Holding has the highest level of compliance with FRS 140 among the company that was studied with a 100%,followed by Sarawak Plantation with 80%. The lowest compliance to FRS 140 goes to Genting Plantation with a percentage of 67%.

Conclusion Overall, the highest compliance to all the FRS that we have studied among the company that we have researched on goes to the Kretam Holding. This is followed by Sarawak Plantation and finally Genting Plantation. Through this research, we have found that the level of compliance to FRS is completely in the hand of the company. Even if disclosure of a particular item is required by FRS, but if the government have not mandated it, the company can choose whether to disclose it or not. We have also gained a more throughout understanding towards the FRS that we have studied as we are required to study the FRS in detail to prepare this report.