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158 KUMPULAN WANG PERSARAAN (DIPERBADANKAN) FoR BEttER REtURNS

notes to the
financial statements
for the year ended 31 december 2022

2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
2.11 Leases

(i) Definition of a lease

a contract is, or contains, a lease if the contract conveys a right to control the use of an identified asset for a
period of time in exchange for consideration. to assess whether a contract conveys the right to control the
use of an identified asset, the group assesses whether:
• the contract involves the use of an identified asset – this may be specified explicitly or implicitly and
should be physically distinct or represent substantially all of the capacity of a physically distinct asset.
if the supplier has a substantive substitution right, then the asset is not identified;
• the customer has the right to obtain substantially all of the economic benefits from use of the asset
throughout the period of use; and
• the customer has the right to direct the use of the asset. The customer has this right when it has the
decision-making rights that are most relevant to changing how and for what purpose the asset is used.
in rare cases where the decision about how and for what purpose the asset is used is predetermined,
the customer has the right to direct the use of the asset if either the customer has the right to operate
the asset; or the customer designed the asset in a way that predetermines how and for what purpose it
will be used.

at inception or on reassessment of a contract that contains a lease component, the group allocates
the consideration in the contract to each lease and non-lease component on the basis of their relative
stand-alone prices. however, for leases of properties in which the group is a lessee, it has elected not to
separate non-lease components and will instead account for the lease and non-lease components as a
single lease component.
(ii) Recognition and initial measurement

As lessee
the group recognises a right-of-use asset and a lease liability at the lease commencement date.
the right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability
adjusted for any lease payments made at or before the commencement date, plus any initial direct costs
incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying
asset or the site on which it is located, less any lease incentives received.

the lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, the respective group entities’ incremental borrowing rate. generally, the group entities use their
incremental borrowing rate as the discount rate.