Page 259 - BAM ONE REPORT 2565 (ENGLISH VERSION)

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Form 56-1 One Report 2022
b) Interest income on installment sale receivables

The Company has recognised interest on installment sale receivables on an accrual

basis throughout the contract period, based on the outstanding principal balance and
using the effective interest rate (Effective interest method). The effective interest rate is
the discount rate that estimates future cash flows over the expected life of financial

instrument. The Company continues to recognise interest income on net carrying
amount of installment sale receivables (the outstanding balance minus allowance for

expected credit loss) that later become credit-impaired using the effective interest rate
method. Subsequently, if such financial asset is no longer credit-impaired, the Company
reverts to calculating interest income on a gross carrying amount.

The Company recognised gain on installment sale receivables when the aggregate
amount of cash received (principal plus accrued interest receivables) from the debtor is
greater than the cost of the properties for sale. The gain recognised is not to exceed the

aggregate amount of the cash received.

c) Interest income from deposits at financial institutions

Interest income from deposits at financial institutions is recognised on an accrual basis
and on a time proportion basis, taking into account the effective interest rate.

d) Interest and dividend income from investments

Interest on investments recognised as income on an accrual basis, taking into account
the effective interest rate. Dividend income on investments is recognised when the right
to receipt of dividend is established.

e) Gain (loss) on trading securities

Gain (loss) on trading securities are recognised as income or expenses on the transaction
date.

4.2 Expense recognition - Interest expenses

Interest expenses are recognised on an accrual basis, using the effective interest rate which

included expenses incurred directly in generating the notes payable and loans. In cases where
interest is already included in the notes payable, interest is recognised as deferred interest
payable and will be amortised to expenses over the tenor of the notes.

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