Teguh Sdn Bhd (TSB) has 130 units of equipments which have different usability balances, obtained at a very high cost of between RM25,000-RM30,000 per unit depending on the specifications and current market price. Some units are new purchases while others are used unit purchases. All units are purchased in cash. Financial information on 1 January 2020 related to the equipments is shown in Table 1 below.

Equipments Group	Cost (RM)	% carrying amount on cost	Fair value (RM)
1	250,000	20%	40,000
2	850,000	40%	300,000
3	600,000	60%	310,000
4	2,200,000	80%	1,760,000
Total	3,900,000		2,410,000

Mr John, as the company's deputy chief accountant, sparked the idea of rationalizing the financial statements through the sale and lease of the equipment assets. Mr John is of the opinion that the equipment assets that still have a carrying value of more than 50% can be sold and leased with a longer lease term. Since his friend is the general manager of a leasing company, Mr John is confident of obtaining an attractive financing package. In the meeting, Mr. John, referring to the data as in Table 1, confidently said,

Currently, the fair value of our assets is around RM2,410,000. I will lobby my friend to buy this asset at a price 20% higher than the market price. I think there is no problem because later he will cleverly adjust the lease rent to cover the 20%. From there we can record a profit on the disposal of assets of 20% in our profit and loss immediately. After that, once we have rented, we no longer need to record depreciation expenses, so once again we can reduce our operating expenses. This lease rent is not that high compare with depreciation expenses. After that, when we sell and we get a lot of cash later, we can cover the salaries of all staff at least for 6 months. I am confident that the economy will improve after 6 months. We can also clear the outstanding debts so that the company's liabilities are decreasing in our balance sheet. The bosses must be surprised with our company, no business but have a lot of cash, debt is decreasing and also making a profit. Most importantly, the boss saw that the projector was still there. We should not let him know that we sale and lease the projector. This asset looks like it is for sale, but in fact it is not, we use this asset as usual, the finance company will not know anything about this asset, there are no restrictions, just make sure all important documents and contracts are valid. If this asset is lost or damaged, let us be responsible for everything. Later, in two or three years, if the economy is as good as before, I will make sure we will buy back all those assets. I will try to negotiate so that this lease contract allows us to buy back at a discount. So how, do you agree with my idea? If everything is ok tomorrow, I will call my friend.

Required:

Discuss whether the relevant IFRS requirements will be an obstacle to Mr. John's plan.