(a) Under a contract between a local government authority (MBSA) and a private sector provider (Topi Sdn Bhd), Topi Sdn Bhd provides MBSJ with 20 trucks to be used for refuse collection on behalf of MBSJ for a 10-year period. The trucks, which are owned by Topi Sdn Bhd, are specified in the contract. MBSA determines how they are used in the refuse collection process. When the trucks are not in use, they are kept at MBSAs premises. MBSA can use the trucks for another purposes if it so chooses. If a particular truck needs to be serviced or repaired, Topi Sdn Bhd is required to substitute a truck of the same type. Otherwise, and other than on default by MBSA, Topi Sdn Bhd cannot retrieve the trucks during the 10-year period.

Required: Explain whether the contract entered by MBSA and Topi Sdn Bhd is considered a lease in accordance to MFRS 16 Leases. [5 marks]

(b) State the five (5) steps in revenue recognition based on MFRS 15 Revenue from Contracts with Customers. [10 marks]