MKH Annual Report 2020

239 MKH BERHAD 45. FAIR VALUE HIERARCHY (CONT’D) Valuation processes applied by the Group The fair value of land and buildings under property, plant and equipment is determined by external, independent property valuers, having appropriate recognised professional qualifications and recent experience in the location and category of property being valued. The Group revalues its land and buildings every five years or at shorter intervals whenever the fair value of the said assets is expected to differ substantially from the carrying amounts. The fair value of investment properties is determined by external, independent property valuers, having appropriate recognised professional qualifications and recent experience in the location and category of property being valued. The independent professional valuer provides the fair value of the Group’s investment property annually. The valuer’s report of certain investment properties amounting to RM65,085,000 for the year ended 30 September 2020 contained a ‘material uncertainty’ clause due to the disruption to the market at the date of valuation caused by COVID-19. The inclusion of this clause highlights and ensure transparency of the fact about unknown future impact that COVID-19 might have on the real estate market, where there is reduced certainty and a higher degree of caution is attached to the valuation than would normally be the case. These investment properties are as follows: - Metro Point Complex - 1 unit of 6-storey shop in MKH Avenue - 6 units of strata shops and office lots with 128 bays of car park in Saville@Melawati Policy on transfer between levels The fair value of an asset to be transferred between levels is determined as of the date of the event or change in circumstances that caused the transfer. Transfer between Level 1 and 2 fair value There is no transfer between Level 1 and 2 fair values during the financial year. 46. CAPITAL MANAGEMENT The primary objective of the Group’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratio in order to sustain future development of the businesses so that it can continue to maximise returns for shareholders and benefits for other stakeholders. The Groupmanages its capital structure andmakes adjustments to it, in light of changes in economic conditions. To maintain or adjust capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders, issue new shares, obtain new borrowings or repay existing borrowings. No changes were made in the objectives, policies and processes during the financial years ended 30 September 2020 and 30 September 2019. Notes to the Financial Statements FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2020