My EG Services Berhad Annual Report 2020

ANNUAL REPORT 2020 127 FINANCIAL STATEMENTS REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS Opinion We have audited the financial statements of MY E.G. Services Berhad, which comprise the statements of financial position as at 31 December 2020 of the Group and of the Company, and the statements of profit or loss and other comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the financial year then ended, and notes to the financial statements, including a summary of significant accounting policies, as set out on pages 131 to 234. In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Group and of the Company as at 31 December 2020, and of their financial performance and their cash flows for the financial year then ended in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia. Basis for Opinion We conducted our audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence and Other Ethical Responsibilities We are independent of the Group and Company in accordance with the By-Laws (on Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants (“By-Laws”) and the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (“IESBA Code”), and we have fulfilled our other ethical responsibilities in accordance with the By-Laws and the IESBA Code. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the Group and of the Company for the current financial year. These matters were addressed in the context of our audit of the financial statements of the Group and of the Company as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Impairment of Financing Receivables Refer to Notes 4.1(e) and 14 to the financial statements Key Audit Matter How our audit addressed the key audit matter As disclosed in Note 14 to the financial statements, financing receivables as at the reporting date amounted to approximately RM229.63 million representing 16% of total assets of the Group. The management assessed the level of allowance for impairment losses on financing receivables based on, amongst others the realisable value of collaterals pledged, the borrowers’ financial position and their abilities to repay. This assessment involves significant judgement and there is inherent uncertainty in the assumptions applied by the management to determine the level of allowance for impairment losses. We considered this as a key audit matter due to the significance of financing receivables and the uncertainty inherent in determining the level of allowance for impairment losses. Our audit procedures included, amongst others:- r reviewed recoverability of financing receivables; r reviewed management’s basis of assessment on impairment loss on financing receivables; r reviewed the management assessment on the borrowers’ creditworthiness and guarantor or collaterals for the financing receivables; r enquired management on procedures in place for the approval of financing receivables; r reviewed the repayment of principal and interest during the financial year; and r considered the adequacy of the Group’s disclosures in this area. INDEPENDENT AUDITORS’ REPORT To The Members of MY E.G. Services Berhad (Incorporated In Malaysia) Registration No: 200001003034 (505639 - K)