Ni Hsin Berhad Annual Report 2017

6. Investment property (continued) 6.1 Fair value information Fair value of investment properties are categorised as follows: 2017 2016 Level 3 Level 3 RM’000 RM’000 Group and Company Building 1,899 1,978 Level 3 fair value is estimated using unobservable inputs for the investment property. Level 3 fair value The following table shows the valuation techniques used in the determination of fair values within Level 3, as well as the significant unobservable inputs used in the valuation models. Description of valuation technique and inputs used Significant unobservable inputs Inter-relationship between significant unobservable inputs and fair value measurement Comparison method: The valuation method considers the sales and listing of comparable properties recorded in the area and adjustments are made between the subject properties and those similar properties. The adjustments are made in relation to location and accessibility, size of the lot, legal and legislation constraints, supply and demand. The most significant input into this valuation approach is price per square foot. Price per square foot (RM822 – RM1,207) The estimated fair value would increase (decrease) if the price per square foot is higher (lower). 7. Inventories Group 2017 2016 RM’000 RM’000 Raw materials and component parts 12,245 10,442 Indirect materials 970 945 Work-in-progress 924 729 Manufactured inventories 6,052 6,523 20,191 18,639 Recognised in profit or loss: Inventories recognised as cost of sales 27,806 27,383 Notes to the financial statements (continued) Annual Report 2017 68