Lease Right-of-Use Asset and Lease Liabilities

9 Months Ended

Apr. 30, 2021

Leases [Abstract]

Lease Right-of-Use Asset and Lease Liabilities

11. LEASE RIGHT-OF-USE ASSET AND LEASE LIABILITIES

The Company officially adopted ASC 842 for the period on and after August 1, 2019 as permitted by ASU 2016-02. ASC 842 originally required all entities to use a “modified retrospective” transition approach that is intended to maximize comparability and be less complex than a full retrospective approach. On July 30, 2018, the FASB issued ASU 2018-11 to provide entities with relief from the costs of implementing certain aspects of the new leasing standard, ASU 2016-02 of which permits entities may elect not to recast the comparative periods presented when transitioning to ASC 842. As permitted by ASU 2018-11, the Company elect not to recast comparative periods, thusly.

As of August 1, 2019, the Company recognized approximately US$26,823, lease liability as well as right-of-use asset for all leases (with the exception of short-term leases) at the commencement date. Lease liabilities are measured at present value of the sum of remaining rental payments as of August 1, 2019, with discounted rate of 3.3% adopted from CIMB Bank Berhad’s fixed deposit rate as a reference for discount rate.

A single lease cost is recognized over the lease term on a generally straight-line basis. All cash payments of operating lease cost are classified within operating activities in the statement of cash flows.

The initial recognition of operating lease right and lease liability as follow:

Gross lease payable	$	27,632
Less: imputed interest		(860	)
Initial recognition as of August 1, 2019	$	26,772

As April 30, 2021 and July 31, 2020 operating lease right of use asset as follow:

	As of April 30, 2021 (unaudited)			As of July 31, 2020 (audited)
Initial recognition as of August 1, 2019	$	26,772		$	26,772
Additional portion from July 31, 2020 to 30 June 2021		2,719			2,719
Accumulated amortization		(27,426	)		(15,105	)
Foreign exchange translation gain		638			(235	)
Balance	$	2,703		$	14,151

As of April 30, 2021 and July 31, 2020 operating lease liability as follow:

	As of April 30, 2021 (unaudited)			As of July 31, 2020 (audited)
Initial recognition as of August 1, 2019	$	26,772		$	26,772
Add: additional portion (increase of leasing fee)		2,719			2,719
Less: gross repayment		(27,770	)		(14,151	)
Add: imputed interest		1,003			743
Foreign exchange translation gain		446			549
Balance	$	3,170		$	16,632
Less: lease liability current portion		(3,170	)		(16,632	)
Lease liability non-current portion	$	-		$	-

For the three and nine months ended April 30, 2021, the amortization of the operating lease right of use asset are $3,718 and $12,321 respectively.

Maturities of operating lease obligation as follow:

Year ending
July 31, 2021 (2 months)		3,170
Total	$	3,170

Other information:

	Nine Months ended April 30,
	2021			2020
	(unaudited)			(unaudited)
Cash paid for amounts included in the measurement of lease liabilities:				-
Operating cash flow from operating lease	$	13,462		$	9,639
Right-of-use assets obtained in exchange for operating lease liabilities		2,703			16,041
Remaining lease term for operating lease (years)		0.2			1.42
Weighted average discount rate for operating lease		3.3	%		3.3	%

Lease expenses were $12,874 and $10,801 during nine months ended April 30, 2021 and 2020 respectively. The Company adopt ASC 842 on and after August 1, 2019.