Page 136 - EXIM-Bank_Annual-Report-2023

EXIM BANk MALAySIA
134 A Vision to Serve Empowering Growth Management Discussion and Analysis
ANNUAL REPORT 2023
Notes to the fiNaNcial statemeNts

2. MATErIAL ACCouNTING PoLICy INForMATIoN (cont’d)
2.4 Summary of material accounting policy information (cont’d)

(n) Revenue recognition (cont’d)
(v) Islamic income recognition

Income from financing and receivables is recognised in the statement of profit or loss using the effective profit
method. The effective profit rate is the rate that discounts the estimated future cash payment and receipts
through the expected life of the financial asset or liability to the carrying amount of the financial asset or
liability. The calculation of the effective profit rate includes all contractual terms of the financial instrument and
includes any fees or incremental costs that are directly attributable to the instrument and are an integral part
of the effective profit rate.

Murabahah, Tawarruq and Istisna’
Murabahah/Tawarruq and Istisna’ income are accrued on monthly basis on the cost outstanding at the
prevailing effective profit rate over the duration of the financing.

Ijarah
Ijarah income is recognised on the effective profit rate of the cost of the leased asset over the leased period.

Income from financing and receivables is recognised in the statement of profit or loss using the effective profit
method. The effective profit rate is the rate that discounts the estimated future cash payment and receipts
through the expected life of the financial asset or liability to the carrying amount of the financial asset or
liability. The calculation of the effective profit rate includes all contractual terms of the financial instrument and
includes any fees or incremental costs that are directly attributable to the instrument and are an integral part
of the effective profit rate.

Bai’ Al Dayn
Bai’ Al Dayn income is recognised monthly on the effective discount rate on the purchase price of the invoice
over the duration of the financing.
Fee income earned from services that are provided over a certain period of time

Fees earned for the provision of services over a period of time are accrued over that period. These fees include
upfront, facility and Kafalah contract fees.
Takaful income

The source of Takaful income is derived from Takaful contributions. Income is recognised based on specific
percentage of the contribution amount from participants. The remaining amount is placed in Risk Fund which
is pooled for underwriting purposes.

Wakalah Fees
Wakalah fees represent fees charged by the shareholder’s fund to manage takaful certificates issued by the
general takaful fund under the principle of Wakalah and are recognised at over time, according to the period
of service provided.