MSM Malaysia Holdings Berhad Annual Report 2019

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2019 19 INTANGIBLE ASSETS (CONTINUED) Goodwill (continued) 2018 Key assumptions Sensitivity VIU lower by RM’000 Domestic selling price Reduce by RM50/MT 323,000 Raw sugar price Increase by 1 cents/lbs 674,000 Domestic sales volume Reduce by 5% 246,000 Discount rate Increase by 1% 298,000 A reduction in selling price of RM47/MT, increase in raw sugar price by 0.5 cents/lbs would, all changes taken in isolation, result in the recoverable amount being equal to the carrying amount. The above sensitivity analysis is based on the movement of individual key assumptions while holding all other assumptions constant. 20 INVESTMENTS IN SUBSIDIARIES Company 2019 2018 RM’000 RM’000 Unquoted investments, at cost At 1 January 2,057,406 2,057,406 Additional investment in a subsidiary (Note 20(a)) 100,000 - At 31 December 2,157,406 2,057,406 Accumulated impairment At 1 January 391,134 - Charged during the year (Note 20(b)) 437,672 391,134 At 31 December 828,806 391,134 Net investment in subsidiaries 1,328,600 1,666,272 a) Non-cash transaction The cost of investment includes the conversion of a loan due from a subsidiary, MSM Sugar Refinery (Johor) Sdn Bhd (“MSMJ”), to cost of investment in subsidiaries during the financial year. The Company’s intercompany loan to MSMJ of RM100,000,000 is capitalised into an enlarged paid up capital of MSMJ of RM130,000,000 by creation of 100,000,000 ordinary shares of RM1 each. MSM Malaysia Holdings Berhad | Annual Report 2019 182