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QUESTION 1

Mumtaz Bhd is a listed company engaged in developing housing and industrial estate. Below is the trial balance as at 30 June 2020.

	Debit	Credit
	RM000	RM000
Investment property at fair value	28,660
Intangible assets on 1 July 2019	18,800
Tax recoverable on 1 July 2019	800
Revenue		158,920
Freehold land at valuation	13,400
Buildings at cost	28,400
Plant and machinery at cost	204,400
Accumulated depreciation as at 1 July 2019:
- building		4,260
- plant and machinery		85,140
Inventory on 30 June 2020	4,300
Trade receivables	7,860
Cash at bank	10,900
Ordinary shares of RM1 each		60,000
Distribution costs	4,460
Retained earnings as at 1 July 2019		6,380
Asset revaluation reserve		12,700
Cost of sales	43,780
Administrative expenses	8,560
10% Debentures		31,660
Finance costs	3,680
Income tax paid	5,720
Trade payables		24,660
	383,720	383,720

Additional information:

1. It is the policy of the company to depreciate the building on a straight-line basis. The land is not depreciated. The first revaluation of land result in a surplus of RM3,500,000. On 1 July 2019, the land was revalued at its fair value of RM12,900,000. The company adopts the revaluation model for the land and building.

On 30 June 2020, the building was revalued at fair value of RM30,290,000. The building was previously revalued resulting in a deficit of RM1,000,000. The remaining useful life of the building is 40 years.

2. On 1 January 2020, Mumtaz Bhd decided to sell one of its plant that was acquired on 1 July 2017 at RM106,000,000. The expected selling price of the plant on that date is RM50,000,000 and a brokerage commission of 2% on the selling price is expected to be incurred.

It is the policy of the company to depreciate the plant and machinery on a yearly basis over a useful life of five (5) years. Depreciation on plant and machinery is charged as part of cost of sales.

3. The investment property has a fair value of RM29,500,000 on 30 June 2020. The company adopted the fair value model for the investment property.

4. The company bought a customer lists from their competitor for RM4,500,000 on 30 June 2020, which are expected to give benefit to the company in the future. The transaction has yet to be recorded in the book.

5. On 1 July 2019, Mumtaz Bhd entered into a contract to lease the machine for 5 years, annual rental payments are RM900,000, payable at the end of each year. The present value of lease liability is RM4,000,000 with incremental borrowing cost of 4%. The contract contains a lease.

6. The tax charge to profit or loss for the year is estimated to be RM5,180,000.

Required:

Prepare the following statements in a form suitable for publication and in compliance with the relevant Malaysian Financial Reporting Standards.

1. A statement of profit or loss and other comprehensive income for the year ended 30 June 2020. (Disclosure of earnings per share is required)

2. A statement of changes in equity for the year ended 30 June 2020.

3. A statement of financial position as at 30 June 2020. (A note on property, plant and equipment is required)

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