Page 308 - MSM_AIR2021

306 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)
(w) Provisions
Provisions are recognised when:
• the Group has a present legal or constructive obligation as a result of past events;
• it is probable that an outflow of resources will be required to settle the obligation; and

• a reliable estimate of the amount can be made.
Where the Group expects a provision to be reimbursed (for example, under an insurance contract), the reimbursement
is recognised as a separate asset but only when the reimbursement is virtually certain. Provisions are not recognised
for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is
determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an
outflow with respect to any one item included in the same class of obligations may be small.
Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using
pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.
The increase in the provision due to passage of time recognised as finance cost.
(x) Onerous contracts
The Group recognises a provision for onerous contracts when the expected benefits to be derived from a contract are
less than the unavoidable costs of meeting the obligations under the contract.
(y) Non-current assets held for sale
Non-current assets are classified as assets held for sale if their carrying amount will be recovered through a sale
transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable
and the asset (or disposal group) is available for sale in its immediate condition. Management must be committed to
the sale, which should be expected within one year from the date of classification as held for sale. Immediately before
classification as held for sale, the assets (or components of a disposal group) are remeasured in accordance with the
Group’s accounting policies. Thereafter, the assets (or disposal group) are recognised at the lower of their carrying
amount and fair value less cost to sell. Assets classified as held for sale, or included within a disposal group that is
classified as held for sale, are not depreciated. Impairment losses on initial classification as held for sale and subsequent
gains or losses on remeasurement are included in profit or loss. Gains are not recognised in excess of any cumulative
impairment loss.
A discontinued operation is a component of the Group’s business that represents a separate major line of business
or geographical area of operations or is a subsidiary acquired exclusively with a view to resale. Classification as a
discontinued operation occurs upon disposal or when the operation meets the criteria to be classified as held for sale,
if earlier. A disposal group that is to be abandoned may also qualify.
Results from operations qualifying as discontinued operations are presented separately as a single amount on profit or
loss. Results from operations qualifying as discontinued operations as of the balance sheet date for the latest period
presented, that have previously been presented as results from continuing operations, are represented as results from
discontinued operations for all periods presented.

In case conditions for classification of non-current assets and disposal groups as held for sale are no longer met,
classification as held for sale ceases. Accordingly, results of operations, previously presented in discontinued operations,
are reclassified and included in result from continuing operations for all periods presented. Non-current assets that
ceases to be classified as held for sale are remeasured at the lower of their carrying amount before classification as held
for sale, adjusted for any depreciation, amortisation or revaluations that would have been recognised had the asset or
disposal group not been classified as held for sale, and its recoverable amount at the date of the subsequent decision
to sell.