PRG Holdings Berhad Annual Report 2018

16. PROPERTY DEVELOPMENT COSTS (continued) Group 2018 2017 RM’000 RM’000 Property development costs at end of financial year: - leasehold land 144,958 144,958 - development costs 141,015 112,113 - accumulated cost recognised in profit or loss (102,337) (67,544) 183,636 189,527 (a) Included in the leasehold land under development is a piece of land provided by Almaharta Sdn. Bhd. (“ASB”), a third party, pursuant to the Joint Venture Agreement (“JVA”) dated 31 December 2013 for the development in Wilayah Persekutuan, Kuala Lumpur. Pursuant to the JVA, ASB agreed to receive the purchase consideration of the leasehold land on a deferred payment basis progressively subject to the fulfilment of the conditions precedent contained in the JVA. All conditions precedent in accordance to the JVA had been fulfilled and the JVA was deemed unconditional with effect from 30 July 2014. During the previous financial year, the Group paid the final instalment of RM10,000,000 of the purchase consideration of the leasehold land in accordance with the terms of JVA. The Group has accrued the remaining amount of RM10,031,000 (2017: RM15,219,000) payable to ASB for the purchase consideration of the leasehold land as disclosed in Note 21(c)(i) to the financial statements. (b) Included in the leasehold land under development is a piece of land purchased from Baycity Park Sdn. Bhd. (“BPSB”) pursuant to the Development Joint Venture Agreement (“DJVA”) entered between BPSB and Premier Baycity Sdn. Bhd. for the proposed development of the development land in Subang U5, Selangor. During the previous financial year, the Group paid RM7,103,000 as part of the purchase consideration of the leasehold land in accordance with the terms of DJVA. The Group has accrued the remaining amount of RM10,569,000 (2017: RM10,569,000) payable to BPSB for the balance of the purchase consideration of the leasehold land as disclosed in Note 21(c)(ii) to the financial statements. (c) Included in property development costs is interest expense of RM329,000 (2017: RM1,675,000) capitalised during the financial year at interest rate of 6.36% (2017: 6.36%) per annum. (d) The leasehold land together with development costs with a total carrying amount of RM26,504,000 (2017: RM167,959,000) have been pledged to licensed banks for banking facilities granted to the Group as disclosed in Note 20 to the financial statements. 17. CASH AND BANK BALANCES Group Company 2018 2017 2018 2017 RM’000 RM’000 RM’000 RM’000 Cash and bank balances 23,067 9,947 501 128 Deposits placed with financial institutions 11,837 26,478 - - Investments in short term funds 175 5,598 - - 35,079 42,023 501 128 2018 A N N U A L R E P O R T 134 notes to the financial statements 31 December 2018 (continued)