9. INTANGIBLE ASSETS (continued) (b) Sensitivity to changes in assumptions Malaysia and China CGU The management believes that a reasonably possible change in the key assumptions on which management has based its determination of the CGU’s recoverable amount would not cause the CGU’s carrying amount to further exceed its recoverable amount. (c) During the financial year, the impairment losses on goodwill of RM12,110,000 (2020: RM16,310,000) have been recognised due to the recoverable amounts determined based on the projected cash flows were lower than the carrying amount of the goodwill. 10. INVESTMENTS IN SUBSIDIARIES Company 2021 2020 RM’000 RM’000 Quoted equity shares - at cost 55,921 55,921 Unquoted equity shares - at cost 5,000 5,000 60,921 60,921 (a) Acquisition of subsidiaries In the previous financial year, the Company acquired the following subsidiaries: (i) On 13 December 2019, PRG Healthcare Sdn. Bhd. (“PRG Healthcare”), a wholly-owned subsidiary of the Company had entered into a shares sale agreement with Dr. Bernard Chin Sze Piaw (“Dr Chin”) to acquire remaining 450 ordinary shares representing 45% of the issued share capital of PRG Active Sdn. Bhd. (“PRGA”), which was a joint venture to the Group, from Dr Chin for a purchase consideration of RM1.00. Dr Chin had on 16 December 2019 resigned as a Director in PRGA and pursuant to that, PRG Healthcare had obtained control of PRGA. Consequently, the investment in PRGA had been transferred from investment in joint venture to investments in subsidiaries. Goodwill on consolidation arising from the acquisition of PRGA of RM66,000 was accounted for using the acquisition method of accounting. On 14 January 2020, PRGA had become a wholly-owned subsidiary of PRG Healthcare, a wholly-owned subsidiary of the Company, upon the completion of the shares sale agreement to acquire remaining 450 ordinary shares of PRGA. NOTES TO THE FINANCIAL STATEMENTS P R G H O L D I N G S B E R H A D A N N U A L R E P O R T 2 0 2 1 120 31 December 2021 (cont’d)
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