Ni Hsin Berhad Annual Report 2018

23. Financial instruments (continued) 23.7 Fair value information (continued) Fair value of financial instruments carried at fair value Level 1 Level 2 Level 3 Total RM’000 RM’000 RM’000 RM’000 Company 2018 Financial assets Other investments 11,967 - - 11,967 2017 Financial assets Other investments 3,570 - - 3,570 Level 2 fair value Investments in club memberships The fair value of investments in club memberships is based on their latest published membership price. Transfers between Level 1 and Level 2 fair values There has been no transfer between Level 1 and Level 2 fair values during the financial year (2017: no transfer in either directions). Level 3 fair value Level 3 fair value is estimated using unobservable inputs for the financial liabilities. The following table shows the valuation techniques used in the determination of fair value within Level 3, as well as the key unobservable inputs used in the valuation models. Financial instruments carried not at fair value Type Description of valuation technique and inputs used Finance lease liabilities Discounted cash flows using a rate based on the current market rate of borrowing of the respective Group entities at the reporting date. 24. Capital management The Group’s objectives when managing capital are to maintain a strong capital base and safeguard the Group’s ability to continue as a going concern, so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Directors monitor adequacy of capital on an ongoing basis. Under the requirement of Bursa Malaysia Practice Note No. 17/2005, the Company is required to maintain a consolidated shareholders’ equity equal to or not less than the 25 percent of the issued and paid-up capital (excluding treasury shares) and such shareholders’ equity is not less than RM40 million. The Company has complied with this requirement. Notes to the financial statements (continued) Annual Report 2018 96