ENRA Group Berhad Annual Report 2020

ENRA Group Berhad - Annual Report 2020 89 NOTES TO THE FINANCIAL STATEMENTS 31 March 2020 7. INVESTMENTS IN SUBSIDIARIES (Cont’d) a. A subsidiary is an entity in which the Group and the Company are exposed, or have rights, to variable returns from its involvement with the subsidiary and have the ability to affect those returns through its power over the subsidiary. (Cont’d) When control of a subsidiary is lost as a result of a transaction, event or other circumstance, the Group would derecognise all assets, liabilities and non-controlling interests at their carrying amount and to recognise the fair value of the consideration received. Any retained interest in the former subsidiary is recognised at its fair value at the date control is lost. The resulting difference is recognised as a gain or loss in profit or loss. b. Equity contributions to subsidiaries are unsecured, interest-free and settlement is neither planned nor likely to occur in the foreseeable future for the purposes of providing the subsidiaries with a long term source of additional capital. c. Acquisition/Incorporation of subsidiaries and subscription of shares in subsidiaries i. Acquisition of Q Homes Sdn. Bhd. (“Q Homes”) On 31 May 2019, ENRA Land Sdn. Bhd. (“ELAND”), a wholly-owned direct subsidiary of the Company has entered into a Shareholders’ Agreement with IBGH Capital Sdn. Bhd. (“IBGHC”) to collaborate in the business of property development in Malaysia via Q Homes. Q Homes was incorporated in Malaysia on 28 February 2019 as a private limited liabilities company. The principal activities of Q Homes and its subsidiaries (“Q Homes Group”) include construction of residential properties and real estate activities. Q Homes owns a 100% equity stake in Merpati TPG Sdn. Bhd. On 20 June 2019 (date of acquisition), ELAND has subscribed for a 51% equity stake in Q Homes for a total cash consideration of RM127,500. The fair value and the carrying amounts of the identifiable assets and liabilities of Q Homes as at the date of acquisition were as follows: Group 2020 RM’000 Assets/(Liabilities) acquired: Property, plant and equipment 6 Property development cost 231 Trade and other receivables 124 Cash and bank balances 50 Trade and other payables (174) Total identifiable net assets 237 Goodwill on consolidation 6 Non-controlling interests (116) Purchase consideration satisfied by cash 127 Cash and cash equivalents acquired (50) Cash outflow on acquisition of subsidiaries 77 The acquisition of Q Home does not materially affect the revenue and profit after tax of the Group for the financial year ended 31 March 2020.