Page 170 - KWAP_Integrated-Report_2023

enricHing national Progress ENRICHING SUSTAINABLE RETURNS

notes to tHe financial statements

for the year ended 31 december 2023

2. MATERiAL ACCOUNTiNG POLiCiES (CONTiNUED)
2.16 income Tax (continued)

(c) Global Minimum Top-Up Tax

the group has adopted the amendments to mfrs 112, Income Taxes – International Tax Reform – Pillar
Two Model Rules upon their release on 2 June 2023. the amendments provide a temporary mandatory relief
from deferred tax accounting for the top-up tax, which is effective immediately, and require new disclosures
about the pillar two exposure.

in 2023, the governments of the united Kingdom and malaysia have each enacted and substantively enacted
new legislation, respectively, to implement the global minimum top-up tax. the group may be subjected to
the top-up tax in relation to its operations in both the united Kingdom and malaysia. however, since the
newly enacted tax legislated in the united Kingdom and malaysia will only come into effect in year 2024 and
2025, respectively, there is no current tax impact for the year ended 31 december 2023.
based on the group’s initial assessment, if the top-up tax has been applied in 2023, the impact is not
significant to the group and KWap.
2.17 Foreign Currencies

(a) Functional and presentation currency
the individual financial statements of each entity in the group is measured using the currency of the primary
economic environment in which the entity operates (“functional currency”). the consolidated financial
statements are presented in ringgit malaysia (“rm”) being the functional and presentation currency of the
group and of KWap.

(b) Foreign currency transaction and balances
transactions in foreign currencies are measured in the respective functional currencies of KWap and its
subsidiaries and are recorded on the initial recognition in the functional currencies at the exchange rates
prevailing on the transaction dates.

monetary assets and liabilities denominated in foreign currencies are translated at the functional currency
spot exchange rate at the reporting date.

exchange differences arising on the settlement of monetary items or on the translation of monetary items
at the reporting date are recognised in the statement of comprehensive income with the exception of the
exchange differences arising on monetary items that form part of the group’s net investment in foreign
operations. such items are recognised initially in other comprehensive income and accumulated under the
foreign exchange reserves in other comprehensive income.
changes in the fair value of monetary securities denominated in foreign currency classified as fVoci income
are analysed between translation differences resulting from changes in the amortised cost of the security
and other changes in the carrying amount of the security. translation differences related to changes in
amortised cost are recognised in profit or loss, and other changes in the carrying amount are recognised in
other comprehensive income.

168 KUMPULAN WANG PERSARAAN (DIPERBADANKAN) i INTEGRATED REPORT 2023