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290 MSM MALAYSIA HOLDINGS BERHAD WHO WE ARE STATEMENT & DISCUSSION BY OUR LEADERS HOW WE OPERATE
ANNUAL INTEGRATED REPORT 2021

NOTES TO THE FINANCIAL STATEMENTS

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2021

3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(e) Intangible assets (continued)

Intangible assets are amortised using the straight line basis over their estimated useful lives as follows:
Intangible assets Estimated useful lives
Brand 25 years
Software 3 – 5 years

Amortisation on intangible assets under development commences when the assets are ready for their intended use.
The nature of the intangible assets are as follows:
(i) Brand is related to a sugar brand ‘Prai’ acquired as part of the acquisition of the sugar business.
(ii) Software relates to information technology (“IT”) used within the Group.
(f) Financial assets

Classification
The Group classifies its financial assets in the following categories:
(i) those to be measured subsequently at fair value (either through profit or loss or other comprehensive income);
and
(ii) those to be measured at amortised cost.
The classification depends on the entity’s business model for managing the financial assets and the contractual terms
of the cash flows.

For assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive
income. For investments in equity instruments that are not held for trading, the Group has made an irrevocable election
at the time of initial recognition to account for the equity investment at fair value through other comprehensive income
(“FVOCI”).
The Group reclassifies debt investments when and only when its business model for managing those assets changes.

Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the Group commits
to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the financial
assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of
ownership.
Measurement

At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at
fair value through profit or loss (“FVPL”), transaction costs that are directly attributable to the acquisition of the financial
asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss.
Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows
are solely payment of principal and interest.