FGV Annual Report 2012

20 Felda Global Ventures Holdings Berhad 1 GENERAL INFORMATION The Company is principally an investment holding company with investments primarily in oil palm plantation and its related downstream activities, sugar refining, manufacturing, logistics and others. The principal activities of the subsidiaries are stated in Note 21 to the financial statements. There have been no significant change in the nature of these activities of the Group and the Company during the financial year other than acquisition of plantation estates prior to listing. On 1 January 2012, the Group acquired plantation estates as disclosed in Note 21(c). The acquisition of plantation estates has been accounted for using the predecessor basis of accounting which has resulted in a recognition of reorganisation reserve amounting to RM2,088,969,000 as disclosed in Note 37 to the financial statements. In the previous financial year, the Company was a private limited liability company, incorporated and domiciled in Malaysia. On 18 January 2012, the Company obtained approval from the Companies Commission of Malaysia to convert its’ status from a private limited liability company to a public limited liability company. On 28 June 2012, the Company completed its initial public offering (“IPO”) exercise and was listed on Main Market of Bursa Malaysia Securities Berhad. The registered office and principal place of business of the Company is located at Level 42, Menara Felda, Platinum Park, No.11 Persiaran KLCC, 50088 Kuala Lumpur. 2 BASIS OF PREPARATION The financial statements of the Group and of the Company have been prepared under the historical cost convention unless otherwise indicated in the individual policy statements in Note 3 to the financial statements. The financial statements have been prepared in accordance with the provisions of the Companies Act, 1965 and Financial Reporting Standards in Malaysia. In the financial year beginning 1 January 2014, the Group, being a Transitioning Entity, will be adopting the new IFRS-compliant framework, Malaysian Financial Reporting Standards (“MFRS”). The preparation of financial statements in conformity with the Companies Act, 1965 and Financial Reporting Standards in Malaysia requires the Directors to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from these estimates. The preparation of the above financial statements requires the use of certain critical accounting estimates and assumptions. It also requires management to exercise judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 5. (i) Standards, amendments to published standards and interpretations adopted by the Group and Company as at 1 January 2012: • Revised FRS 124“Related Party Disclosures” • IC Interpretation 19“Extinguishing Financial Liabilities with Equity Instruments” • Amendment to FRS 7“Financial Instruments: Disclosures on Transfers of Financial Assets” • Amendment to FRS 112“Income Taxes: Deferred Tax – Recovery of Underlying Assets” • Amendments to IC Interpretation 14“FRS 119 – The Limit on a Defined Benefit Assets, Minimum Funding Requirements and their Interaction” The adoption of the above standards, amendments to published standards and interpretations did not have a significant financial impact on the Group and did not result in substantial changes in the Group’s accounting policies except for Revised FRS 124, the principal effects of which are discussed below: • Revised FRS 124“Related Party Disclosures”(effective from 1 January 2012) removes the exemption to disclose transactions between government-related entities and the government, and all other government-related entities. The following new disclosures are now required for government related entities: – The name of the government and the nature of their relationship; – The nature and amount of each individually significant transactions; and – The extent of any collectively significant transactions, qualitatively or quantitatively. The effects on the financial statements following the adoption of Revised FRS 124 are additional disclosures. Notes to the Financial Statements for the financial year ended 31 December 2012