Title: Effective Date:

FIXED ASSETS – PROPERTY, PLANT & EQUIPMENT 1st May 2024

1. Purpose

The purpose of this policy is to set forth the guidelines for the Group in relation to: -

a) Recognition and measurement of fixed assets.

b) Acquisition of new assets.
c) Maintenance of existing fixed assets.
d) Disposal, Write off and Transfer fixed assets.
e) Controls and Safeguarding of fixed assets.
f) Roles and responsibilities.

2. Policies & Procedures

a) Recognition & Measurement

i) Recognition
The Group follows the prescription of IAS16 accounting treatment for property, plant, and
equipment. Property, plant and equipment are tangible items that:

● are held for use in the production or supply of goods or services, for rental to others, or for
administrative purposes; and
● are expected to be used for more than one year.

Items of property, plant, and equipment should be recognised as assets when it is probable that:

● the future economic benefits associated with the asset will flow to the entity; and

● the cost of the asset can be measured reliably.

ii) Measurement

This recognition principle is applied to all property, plant, and equipment costs at the time they are
incurred. These costs include costs incurred initially to acquire or construct an item of property,
plant and equipment and costs incurred subsequently to add to, replace part of, or service it.

An item of property, plant and equipment is initially measured at its cost. Cost includes:
 ● its purchase price, including import duties and non-refundable purchase taxes, after
deducting trade discounts and rebates.
● any costs directly attributable to bringing the asset to the location and condition necessary
for it to be capable of operating in the manner intended by management.
● the estimated costs of dismantling and removing the item and restoring the site on which it
is located, unless those costs relate to inventories produced during that period. This includes
the reconstruction cost for office or warehouse leases.
● cost of borrowing i.e. capitalise the interest on loan capital.

● fixed assets should be capitalized when the risk and rewards are transferred to the
Company. Progressive payments for fixed assets yet to be installed or constructed should be
debited to “Fixed Asset Under Construction” account and upon completion, all cumulative
costs should be capitalized.

Unit of measurements prescribed by IAS16

● Cost model - The asset is carried at cost less accumulated depreciation and impairment.

● Revaluation model - The asset whose fair value can be measured reliably is carried at a
revalued amount, which is its fair value at the date of the revaluation less any subsequent
accumulated depreciation and subsequent accumulated impairment losses. Revaluations
must be made regularly and kept current. Revaluation increases are recognised in other
comprehensive income and accumulated in equity unless they reverse a previous
revaluation decrease. Revaluation decreases recognised in profit or loss unless they reverse
a previous revaluation increase.

The Group has adopted the Cost model. Each part of an item of property, plant, and equipment with
a cost that is significant in relation to the total cost of the item must be depreciated separately.

The carrying amount of an item of property, plant, and equipment will include the cost of replacing
the part of such an item when that cost is incurred if the recognition criteria (future benefits and
measurement reliability) are met. The carrying amount of those parts that are replaced is
derecognised in accordance with the derecognition provisions of IAS.

iii) Low- value Assets

All assets, except for android scanners and computers (Note - for low value scanners, less than
USD300, we expense off the item), acquired at purchase cost of less than USD500 or its equivalent
should be completely written off in the year of acquisition. Android scanners and computers are to
be considered as fixed assets and recorded in the same manner as any other fixed assets. The
threshold amount given below applies to per item basis and not per invoice.

iv) Depreciation
For all depreciable assets:
● The depreciable amount should be allocated on a systematic basis over the asset's useful
life. Depreciable amount is the cost of an asset, or other amount substituted for cost, less its
residual value.
● Depreciation of fixed assets is computed on a straight-line basis over their useful life.
The following expected economic useful lives can be used as guidance for the Group:

Fixed Assets Category Fixed Asset Sub-Category Useful Life (Years)

Land & Building Land & Building 2

Furnitures & Fittings Furnitures & Fittings 3

Franchise Set Up Assets 5

Ninja Branch Set Up Assets 5

Leasehold Improvement 10

Machinery Ninjapoint Lockers & Software 10

Equipment Office Equipment 3

Warehouse Tools & Equipment 3

Warehouse Machinery 3

Computer Hardware 3

Motor Vehicles Company Vehicles 10

Vehicles – Motor Bikes 10

Vehicles – Trucks 10

Vehicles – Vans 10

Intangibles Computer Software and License 3

● The depreciation charge for each period is recognised in profit and loss unless it is included
in the carrying amount of another asset. Depreciation charges commence from the date of
acquisition.
● The residual value and the useful life of an asset should be reviewed at least once every
financial year-end and, if expectations differ from previous estimates, any change is
accounted for prospectively as a change in estimate.
● The depreciation method used should reflect the pattern in which the asset's economic
benefits are consumed by the entity; a depreciation method that is based on revenue
generated by an activity which includes the use of an asset is not appropriate.

b) Acquisition of new fixed assets

i) Scope
The policies and procedures should be applied to the acquisition of new fixed assets or used
items.

ii) Policies
 All acquisition of fixed assets must be reviewed and approved by Department and/or Country
Heads prior to placement of orders with suppliers. Any purchase for CAPEX that is out of budget
needs to be approved according to Level of Approval (LOA).

iii) Procedures
- For all budgeted expenditure, requestor to put up email/document/form request/Capital
Expenditure Request Form (CERF)
● Country Head and CTO to approve for all purchases of IT or IT related equipment.

● CEO to approve for all purchases and replacement of vehicles.

● Department Head and/or Country Head to approve for all other fixed assets expenditures.
- For all unbudgeted expenditure, requestor to put up email/document/form request/Capital
Expenditure Request Form (CERF) and forward to CFO/CGE/CEO for approval (As per LOA).
- Submit approved documents (email/documents/CERF) to procurement to process Purchase
Order (PO) in NetSuite’s system.
- Send PO to Vendors/Suppliers. Once items/goods have been delivered, inform procurement
to do the receiving in NetSuite’s system. Forward the Delivery Order (DO) and/or tax invoices
to Finance for processing.
- Finance will process the invoice and assign an asset number to the asset or update the fixed
assets register (if it is not processed in NetSuite system). Print an asset label and tag to the
asset.

c) Maintenance of existing assets

In order to maintain an adequate fixed asset accounting system that allows for overall
safeguarding of fixed assets, the Fixed Asset Register in NetSuite’s system requires periodic
update (annual inventory count) and maintenance to remain current and valuable. Additional
fixed asset acquisitions, transfers, sale of surplus, disposal and corrections must be entered into
the system in a timely manner (weekly). It is imperative that those responsible comply with this
document to establish and maintain accurate fixed asset records.

d) Disposal, Write Off & Transfer of Fixed Assets

i) Scope
The policies and procedures should be applied to the disposal, write off & transfer of fixed assets. The
approval amount will be the greater of net book value or resale value.

ii) Policies
- All Fixed Assets Disposal/Write Off Form must be approved by Country Head.
- No sale or disposal of fixed assets which are currently servicing the hire purchase loan or
bank loan are allowed unless full settlement with the respective finance companies or
banks have been done.
- All sales of fixed assets should be transacted at arm’s length (3 quotes).
- All fixed assets transfer forms should be concurred by respective department heads before
forwarding to the local Finance Manager for approval.
- All internal and external transfers must be supported by the approved Fixed Assets
Transfer Form. Transferor is in charge of completing the form to reflect the transfer of the
asset to the transferee.

iii) Procedures
Disposal/Write off
- Requestor completes the Fixed Assets Disposal /Write off Form and submit to Country
Head for approval.
- Requestor forwards the duly authorized Form to Finance Department for:
● updating the Fixed Assets Register.

● raising DO and invoices (if it is a sale of fixed assets).

● arranging for settlement of Hire Purchase (HP) or bank loan (if needed).
- The Fixed Assets Disposal/Write off form will also be routed to the Finance department for
the processing in NetSuite’s system.
- Requestor arranges for disposal of the fixed assets. Finance supervises the disposal
process.
- For sales of fixed assets, the requester will collect the sales proceeds from the customer
before releasing the physical fixed assets. Hand over the proceeds to Finance for banking
in.
- Finance processes the sales of fixed assets and issues an invoice to purchasers. Bank in the
proceeds into the bank.
Transfer
- For transfer, the transferor completes the transfer form to the department head for
approval. After approval, pass it to the transferee to sign. After signing, forward it to
Finance for processing.
- For transfer, Finance will record and file the Fixed Asset Transfer form and update the fixed
asset register or NetSuite’s system.
- Transfer between intercompany billing will be performed by transferor to transferee the
net book value of the transferred asset.

e) Controls and Safeguarding of fixed assets

i) Scope
The policies and procedures should be applied to the control and safeguard of fixed assets.

ii) Policies
- A fixed assets register is maintained by local Finance in NetSuite’s system.
- All new fixed assets must be properly tagged with reference to the fixed assets register
number.
- A physical count of fixed assets should be conducted at least once every year to ensure
their existence. Assets no longer in existence should be written off from the accounts to
reflect physical counts. Writing off assets must be explained and approved by the Country
Head.
- Transfers of assets between business units must be agreed in writing by both the
transferor and the transferee. The fixed asset transfer form must be filed by the transferor
and the fixed asset register regularly and accurately updated.
- In the event of resignation, employees who are assigned laptops or other assets must hand
over those assets to the local HR. These assets officially handed over must be
acknowledged by the local HR. If the laptops and assets are subsequently passed over to a
new or replacement employee, HR would have to file the fixed assets transfer form to
Finance.
- Finance Manager will maintain a fixed asset list for individual staff and any assets
movement must be supported by fixed assets transfer or disposal form and routed to the
Finance department for updating. Any purchase requisition form raised for the purchase of
 assets should be routed to the Finance Department to update the fixed assets listing
records of individual staff. Upon resignation, all employees are required to return all items
listed on their individual list.

f) Roles & Responsibilities

The major responsibilities each party has in connection with the Fixed Assets Policy & Procedures are
as follows:

Finance is responsible for:

● The establishment and maintenance of an adequate fixed asset accounting system that
allows for the proper presentation of plant assets in the financial statements and the
overall safeguarding of fixed assets
● Ensuring the fixed asset accounting system is being properly maintained, including the
identification of capital assets, accurate use of codes, determination of useful lives,
reconciliation to the general ledger, and financial reporting.

All Department Heads are responsible for:

● Maintaining current inventory records for all in-use fixed assets within their assigned
department.
● Assuring property is given proper care and protection.

● Ensuring that property is used only in the conduct of official business.

● Notifying the finance department of any changes in the status of an asset.

● Notifying the finance department whenever fixed assets are transferred/acquired, sold,
donated, destroyed, stolen or lost.
● Identifying and reporting to the finance department along any surplus property which is
usable but not needed in his/her area, or which is beyond economic repair and therefore
to be disposed of.
● Assisting in taking physical inventories.

3. Disclosures in Notes
- The disclosure requirements in IAS 16 require a table that explains the movements in cost, or
revalued amount and depreciation. However, IAS 16 requires disclosures to be given for each
class of property, plant and equipment adopted, which may result in a large volume of
disclosures, particularly where a revaluation policy has been adopted.

- IAS 16 requires the following disclosures for each class of property, plant and equipment:
a) The measurement bases (e.g., cost or revaluation) used for determining the gross
carrying amounts
b) The depreciation methods used (e.g., straight-line method or declining balance
method)
c) The useful lives or the depreciation rates used
 d) The gross carrying amount (cost or revalued amount) at both the beginning and end
of the period
e) The cumulative amount of provisions for depreciation (aggregated with accumulated
impairment losses) at the beginning and end of the period
f) The depreciation for the period, whether recognized in profit or loss or as part of the
cost of other assets
g) A reconciliation of the carrying amount at the beginning and end of the period,
separately disclosing:
- Additions
- Assets (or assets included in a disposal group) classified as held-for-sale
under IFRS 5 and other disposals
- Acquisitions through business combinations
- Revaluation increases or decreases
- Impairment losses recognized or reversed in other comprehensive income
- Impairment losses recognized in profit or loss
- Past impairment losses reversed in profit or loss
- Depreciation
- Exchange differences arising on the retranslation of the financial statements
of a foreign operation
- Other changes
h) The carrying amount (that is the net book amount) at the beginning and end of the
period

- The financial statements should also disclose:

● The existence and amounts of restrictions on title and property, plant and equipment

pledged as security for liabilities.

● The amount of expenditure included in the carrying amount of property, plant and

equipment in the course of construction

4. Standards
IAS 16