ENRA Group Berhad Annual Report 2020

ENRA Group Berhad - Annual Report 2020 82 NOTES TO THE FINANCIAL STATEMENTS 31 March 2020 4. PROPERTY, PLANT AND EQUIPMENT (Cont’d) a. All items of property, plant and equipment are initially measured at cost. After initial recognition, property, plant and equipment except for freehold land is is stated at cost less accumulated depreciation and any accumulated impairment losses. b. Depreciation is calculated to write off the costs of the assets to their residual values on a straight line basis over their estimated useful lives. The principal depreciation rates and period are as follows: Building 3% Furniture, fittings, renovation and office equipment 10% - 33.33% Computer hardware and software 20% - 33.33% Motor vehicles 20% Marine equipment 7% Plant and machinery 10% Freehold land has unlimited useful life and is not depreciated. Capital work-in-progress of the Group comprises warehouse under construction and a vessel acquired during the year currently undergoing modification work. These capital work-in-progress are stated at cost and not depreciated until such time when the asset is available for use. c. As at the end of the reporting period, certain plant and machinery and capital work in progress of the Group with a carrying amount of RM73,911,000 (2019: RM Nil) has been charged as securities for banking facilities granted to the Group as disclosed in Note 25(c) to the financial statements. d. During the financial year, the Group and the Company made the following cash payments to purchase property, plant and equipment: Group Company 2020 RM’000 2019 RM’000 2020 RM’000 2019 RM’000 Purchase of property, plant and equipment 83,142 1,256 22 6 Financed by term loans (48,223) - - - Transfer to inventories - (49) - - Cash payments on purchase of property, plant and equipment 34,919 1,207 22 6