MKH Annual Report 2020

182 FINANCIAL STATEMENTS ANNUAL REPORT 2020 20. RECEIVABLES, DEPOSITS AND PREPAYMENTS (CONT’D) (h) The joint venture deposits of the Group and of the Company are paid to landowners in respect of Joint Venture Agreements (“Agreements”) whereby the Group and the Company are responsible to implement and undertake the overall development projects on the land owned by the third parties upon fulfilment of the terms and conditions as stipulated in the Agreements. During the financial year, the Group reclassified joint venture deposits amounted to RM5,104,000 to property development costs upon fulfilment of terms and conditions stipulated in the Agreements as disclosed in Note 21. (i) Included in other deposits of the Group is RM16,363,930 (2019: RM14,589,339) paid to the relevant authorities for property development projects. (j) Included in prepayments of the Group are: (i) RM20,233,867 (2019: RM6,155,837) preliminary costs incurred in respect of future property development projects. During the financial year, the Group reclassified certain prepayments pertaining to joint venture projects amounted to RM1,148,302 to property development costs upon fulfilment of terms and conditions stipulated in the Agreements as disclosed in Note 21; and (ii) an amount of RM7,043,591 (2019: RM8,706,155) paid to Trustee accounts for joint development of infrastructure projects with other developers. 21. PROPERTY DEVELOPMENT COSTS The Group 2020 RM 2019 RM At cost: Freehold land At beginning of year 220,054,496 204,227,635 Additions 36,480,392 29,632,449 Reclassification to development costs - (18,392,560) Transfer from land held for property development (Note 18) 4,864,214 4,586,972 Transfer from joint venture deposits (Note 20 (h)) 5,104,000 - Transfer to inventories (24,703) - Adjustment on completion of projects (215,225) - At end of year 266,263,174 220,054,496