Page 137 - Exim iar24_Ebook

EXIM BANK MALAYSIA ANNUAL REPORT 2024

7 FINANCIAL STATEMENTS 135
NOTES TO THE FINANCIAL STATEMENTS

2. MATERIAL ACCOUNTING POLICY INFORMATION (cont’d)

2.4 Summary of material accounting policy information (cont’d)
(p) Zakat

Zakat is payable by the Group and the Bank in compliance with the principle of Shariah and in line with National
Fatwa Committee regulations. Nevertheless, no provision for zakat has been made during the year.
(i) Method applied

Zakat is calculated using the growth method which is based on the adjusted net asset of the Group and the
Bank, i.e. net asset excludes any items that do not meet the condition for zakat assets and liabilities.

(ii) Beneficiaries of zakat fund
The method of zakat distribution, as being practised by the Group and the Bank, is as follows:

• Zakat is paid to Pusat Pungutan Zakat (“PPZ”) based on certain percentage of the adjusted net asset of the
Bank and the Group;
• PPZ will determine a certain percentage of the zakat for the Bank’s own distribution; and
• The distribution of zakat will be allocated by the Bank to three (3) groups of people who are eligible to receive
zakat (asnaf):
a. The destitute (fakir);
b. The poor (miskin); and
c. Those in the cause of Allah (fi sabilillah).
(q) Foreign currencies

The Group’s consolidated financial statements are presented in Malaysian Ringgit, currency which is also the
Bank’s (i.e. parent company’s) functional currency. For each entity, the Group determines the functional currency
and items included in the financial statements of each entity are measured using that functional currency.
The Group uses the direct method of consolidation, the gain or loss that is reclassified to profit or loss reflects the
amount that arises from using this method.
Transactions in foreign currencies are translated to the functional currencies of the Group’s entities at their
respective functional currency spot rates at the date of the transaction. Monetary assets and liabilities denominated
in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date.
Differences arising on settlement or translation of monetary items are recognised in statement of profit or loss.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rates at the date when the fair value is determined. The gain or loss
arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the
gain or loss on the change in fair value of the item (i.e. translation differences on items whose fair value gain
or loss is recognised in other comprehensive income or statement of profit or loss are also recognised in other
comprehensive income or statement of profit or loss, respectively).
(r) Foreclosed properties

Foreclosed properties are those acquired in full or partial satisfaction of debts and are stated at the lower of cost
and fair value.