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300 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)
(o) Revenue recognition

(i) Revenue from contracts with customers
• Sales of goods
The Group’s revenue which represents income arising in the course of the Group’s and the Company’s
ordinary activities is recognised by reference to each distinct performance obligation promised in the
contract with customer when or as the Group and the Company transfer the control of the goods and
services promised in a contract and the customer obtains control of the goods or services. Depending on
the substance of the respective contract with customer, the control of the promised goods or services may
transfer over time or at point in time.

A contract with customer exists when the contract has commercial substance, the Group, the Company
and their customers have approved the contract and intend to perform their respective obligations,
the Group’s, the Company’s and the customer’s rights regarding the goods or services to be transferred
and the payment terms can be identified, and it is probable that the Group and the Company will collect the
consideration to which it will be entitled to in exchange of those goods or services.
Revenue from contracts with customers is measured at its transaction price, being the amount of
consideration which the Group expects to be entitled in exchange for transferring promised goods or
services to a customer, excluding amounts collected on behalf of third parties such as sales and service
taxes or goods and service tax. If the amount of consideration varies due to discounts, rebates, penalties or
other similar items, the Group and the Company estimate the amount of consideration that it expects to be
entitled based on the expected value method or the most likely outcome but the estimation is constrained
up to the amount that is highly probable of no significant reversal in the future. Transaction price is allocated
to each performance obligation on the basis of the relative standalone selling prices of each distinct good
or service promised in the contract.
The Group sells refined sugar, liquid sugar, sugar premix, raw sugar and molasses in connection to the sugar
operation. In addition, the Group also sells rubber, palm oil and mango through its plantation segment.
Revenue from sales of goods from the sugar operation and plantation are recognised net of discount and
taxes at the point in time when control of the goods has transferred to the customer. Depending on the
terms of the contract with the customer, control transfers either upon delivery or shipment of goods to
the specific location agreed with the customer, the risks of obsolescence and loss have been transferred
to the customer, and either the customer has accepted the goods in accordance with the sales contract,
the acceptance provisions have lapsed, or the Group has objective evidence that all criteria for acceptance
have been satisfied.