162 F INANC IAL Statements 05 Sect ion Ranhi ll Ut i l i t i es Berhad NOTES TO THE F INANC I AL STATEMENTS For the year ended 31 December 2022 3. SIGNIFICANT ACCOUNTING POLICIES (contd.) Revenue from contracts with customers and other revenue (contd.) (e) Recognise revenue when (or as) the Group and the Company satisfy a performance obligation. (contd.) The following describes the performance obligation in contracts with customers: (contd.) Others (contd.) (n) Dividend income Dividend income is recognised when the Group’s right to receive payment is established. Contract related assets and liabilities (a) Contract assets A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the Group performs by transferring goods or services to a customer before the customer pays consideration or before payment is due, a contract asset is recognised for the earned consideration that is conditional. (b) Contract liabilities A contract liability is the obligation to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the Group transfers goods or services to the customer, a contract liability is recognised when the payment is made or the payment is due (whichever is earlier). Contract liabilities are recognised as revenue when the Group performs under the contract. (c) Costs to fulfill a contract The costs incurred in fulfilling a contract with a customer that are not within the scope of other MFRSs, such as MFRS 116: Property, Plant and Equipment and MFRS 138: Intangible Assets, are recognised as contract cost assets when all of the following criteria are met: • the costs relate directly to a contract or to an anticipated contract that can be specifically identified; • the costs generate or enhance resources of the Group that will be used in satisfying (or in continuing to satisfy) performance obligations in the future; and • the costs are expected to recovered. Contract cost assets are amortised on a systematic basis that is consistent with the transfer to the customers of the goods or services to which the asset relates. Impairment loss is recognised in profit or loss to the extent that the carrying amount of the contract cost exceeds: • the remaining amount of consideration that the Group expects to receive in exchange for the goods or services to which the asset relates; less • the costs that relate directly to providing those goods or services and that have not been recognised as expenses.
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