INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF KIMLUN CORPORATION BERHAD (Incorporated in Malaysia) Registration No: 200901023978 (867077-X) Key Audit Matters (Cont'd) Recoverability of trade receivables and contract assets Refer to Notes 4(b) and 21 to the financial statements Key Audit Matter How our audit addressed the Key Audit Matter • • • • • Assessing the adequacy of disclosures in the notes to the financial statements. To address this risk, our audit procedures involved the following: The carrying amount of trade receivables and contract assets of the Group are RM500,592,031 and RM175,223,675 respectively as at 31 December 2021. Reviewing the Group credit risk policies on impairment losses for trade receivables and contract assets; As such, the Group has material credit exposures in its trade receivables and contract assets. The assessment of impairment involves significant estimation uncertainty, subjective assumptions and the application of significant judgements. Evaluating the reasonableness on the impairment losses provided or reversed in accordance with the Group credit risk policies; and Testing the reliability and accuracy of ageing report; Performing recoverability review on selected trade receivables and contract assets; - 11 - INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF KIMLUN CORPORATION BERHAD (INCORPORATED IN MALAYSIA) K imlun Corporat ion Berhad Regi s t rat ion No. 200901023978 (867077-X) 71
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