Sime Darby Plantation Berhad Group – Annual report – 31 December 2019
2. BASIS OF PREPARATION (extract)
a. Accounting pronouncements that have been adopted in preparing these financial statements (extract)
The Annual Improvements to MFRSs 2015–2017 Cycle on MFRS123 “Borrowing Costs” requires borrowings obtained specifically for the construction of a qualifying asset to be designated as general borrowings when the qualifying asset is ready for its intended use or sale. Hence, instead of charging to profit and loss, such borrowing costs are capitalised as part of other qualifying assets. This has resulted in the capitalisation of additional finance costs of RM48.8 million into property, plant and equipment for the year ended 31 December 2019.