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302 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)
(p) Dividend distribution

Dividends on ordinary shares are recognised as liabilities when proposed or declared before the statement of financial
position date. A dividend proposed or declared after the statement of financial position date, but before the financial
statements are authorised for issue, is not recognised as a liability at the reporting date.

(q) Cash and cash equivalents
For the purpose of the statement of cash flows, cash equivalents are held for the purpose of meeting short-term
cash commitments rather than for investment or other purposes. Cash and cash equivalents comprise cash on hand,
deposits held at call with financial institutions, other short term, highly liquid investments with original maturities of
3 months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk
of changes in value.
(r) Leases
The Group and Company as a lessee

Leases are recognised as a right-of-use (“ROU”) asset and a corresponding liability at the date at which the leased asset
is available for use by the Group and Company.
(a) ROU assets

ROU assets are measured at cost comprising the following:
• the amount of the initial measurement of lease liability;
• any lease payments made at or before the commencement date less any lease incentives received;
• any initial direct costs; and
• decommissioning or restoration costs.
The ROU asset is depreciated over the shorter of the right-of-use asset’s useful life and the lease term on a
straight-line basis, as follows:
ROU assets Estimated useful lives

Leasehold land 66 to 99 years
Buildings 3 to 60 years
The ROU assets are adjusted for certain remeasurement of the lease liability.

At each statement of financial position date, the Group assesses whether there is any indication of impairment.
If such an indication exists, an analysis is performed to assess whether the carrying amount of the asset is fully
recoverable. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s
carrying amount is greater than its estimated recoverable amount. See significant accounting policies Note 3(k)
on impairment of non-financial assets.