Page 204 - Full Book_24.4.2021

NOTES TO THE
FINANCIAL STATEMENTS

for the financial year ended 31 december 2020 (continUed)

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2.12 Impairment (continued)
Impairment of other assets
the carrying amount of other assets (except for current tax assets and deferred tax assets) are reviewed at the end of
each reporting period to determine whether there is any indication of impairment. if any such indication exists, then the
asset’s recoverable amount is estimated.
inteGrated annUal rePort 2020 the recoverable amount of an asset is the greater of its value in use and its fair value less costs to sell. in assessing value

in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset.
an impairment loss is recognised if the carrying amount of an asset exceeds its recoverable amount. impairment losses
are recognised in the profit or loss.
impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has
decreased or no longer exists. an impairment loss is reversed if there has been a change in the estimates used to
determine the recoverable amount. an impairment loss is reversed only to the extent that the asset’s carrying amount
198 does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no
impairment loss had been recognised. reversals of impairment losses are credited to the profit or loss in the year in which
the reversals are recognised.
bimb holdinGS berhad 199701008362 (423858-X) 2.14 provisions
2.13 Bills and acceptances payable
bills and acceptances payable represent the Group’s own bills and acceptances rediscounted and outstanding in the
market. refer to note 2.5 on recognition and measurement of financial liabilities.

a provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can
be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.

the provisions are reviewed at each reporting date and if it is no longer probable that an outflow of resources embodying
economic benefits will be required to settle the obligation, the provision is reversed.

2.15 General Takaful Fund
the General takaful fund is maintained in accordance with the islamic financial Services act, 2013. included in General
takaful fund are funds arising from:
• General Takaful; and
• General retakaful funds.
the General takaful underwriting results are determined for each class of takaful business after taking into account
retakaful, unearned contributions, claims incurred and administrative fees.
Contribution liabilities
contribution liabilities represent the future obligations on takaful contracts as represented by contributions received for
risks that have not yet expired. the movement in contribution liabilities is released over the term of the takaful contracts
and recognised as earned contribution income.
contributions liabilities are reported at the higher of the aggregate of the unearned contribution reserves (“Ucr”)
respectively for all lines of business or the best estimate value of the unexpired risk reserves (“Urr”) and a provision of
risk margin for adverse deviation (“PRAD”) calculated at 75% confidence level at the end of the financial year.