18. Other financial assets and financial liabilities (cont’d.) (d) Finance lease receivables (cont’d.) The effective interest rate of the Group’s finance lease receivables is between 4.75% to 6.52% (2015: 5.96% to 16.37%). Included in minimum lease receivables are the estimated unguaranteed residual values of the leased assets of RM264,122,000 (2015: RM145,280,000). As disclosed in Note 15, upon completion of the equity buyback on 13 May 2016, GKL became a whollyowned subsidiary of the Corporation. Included in the net assets and liabilities acquired is GKL’s finance lease receivables of RM9,108,105,000. In the current financial year, the Group took delivery of a liquefied natural gas (“LNG”) carrier. Upon commencement of the finance lease of the ship on 7 October 2016, RM908,220,000 was recognised as finance lease receivables. In the current financial year, the Group also wrote off RM196,054,000 of finance lease receivables following termination of a lease contract by the customer. 19. Finance lease assets under construction The finance lease assets under construction relates to progress payments made in respect of ships under construction for which charter contracts classified as finance leases have been entered into with a lessor. The movement of the finance lease assets under constructions are as follows: Group Corporation 2016 2015 2016 2015 RM’000 RM’000 RM’000 RM’000 At 1 January 1,256,005 – 1,256,005 – Additions 1,006,393 1,142,204 1,006,393 1,142,204 Transfer to finance lease receivables (Note 18(d)) (908,220) – (908,220) – Currency translation differences 63,805 113,801 63,805 113,801 At 31 December 1,417,983 1,256,005 1,417,983 1,256,005 MISC BERHAD • Annual Report 2016 262 notes to the financial statements - 31 december 2016
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