FGV HOLDINGS BERHAD | AUDITED FINANCIAL STATEMENTS 2023 29 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023 2 BASIS OF PREPARATION (CONTINUED) (ii) Accounting pronouncements that are not yet effective and have not been early adopted by the Group and Company: Accounting pronouncements that are currently being assessed by the Group: Effective for annual periods beginning on or after 1 January 2024 • Amendments to MFRS 101 ‘Classification of liabilities as current or non-current’ (‘2020 amendments’) and ‘Non-current Liabilities with Covenants’ (‘2022 amendments’) • Amendments to MFRS 16 ‘Lease Liability in a Sale and Leaseback’ • Amendments to MFRS 107 and MFRS 7 ‘Supplier Finance Arrangements’ Effective annual periods beginning on or after 1 January 2025 • Amendments to MFRS 121 on ‘Lack of Exchangeability’ The accounting pronouncements that are not yet effective are not expected to have any significant impact on the financial statements of the Group and Company. 3 MATERIAL ACCOUNTING POLICIES The principal accounting policies applied in the preparation of financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. (a) Basis of consolidation and investment in subsidiaries The consolidated financial statements include the financial statements of the Company and all its subsidiaries made up to the end of financial year. Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. Acquisition accounting The acquisition method of accounting is used to account for the acquisition of subsidiaries by the Group when the acquired sets of activities and assets meet the definition of a business. The Group determines that it has acquired a business when the acquired set of activities and assets include an input and a substantive process that together significantly contribute to the ability to create outputs. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of the non-controlling interests. The Group recognises any non-current controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest’s proportionate share of the recognised amounts of acquiree’s identifiable net assets. At the end of reporting period, non-controlling interests consists of amount calculated on the date of combinations and its share of changes in the subsidiary’s equity since the date of combination.
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