NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021 24. Segment reporting (cont’d) The Group’s segmental information is as follows: Malaysia Australia Total RM RM RM 31 December 2020 Rental 103,918,211 11,792,068 115,710,279 Property expenses (5,943,869) (152,184) (6,096,053) Net property income 97,974,342 11,639,884 109,614,226 Investment income 1,011,305 - 1,011,305 Unrealised gain on foreign exchange 736,084 - 736,084 Other income 1,414,273 - 1,414,273 Fair value adjustment on investment properties (5,423,801) (42,348,660) (47,772,461) Total income 95,712,203 (30,708,776) 65,003,427 Expenditure (14,283,068) (1,841,909) (16,124,977) Operating profit 81,429,135 (32,550,685) 48,878,450 Financing costs (35,254,090) - (35,254,090) Profit before tax 46,175,045 (32,550,685) 13,624,360 Tax (2,534,162) 1,481,204 (1,052,958) Profit after tax 43,640,883 (31,069,481) 12,571,402 Total assets 1,526,820,587 121,165,750 1,647,986,337 Total liabilities 704,152,450 343,726 704,496,176 25. Capital management The Group and the Fund manage their capital to ensure that entities in the Group and the Fund will be able to continue as going concerns while maximising the return to unitholders through the optimisation of the debt and equity balance. The capital structure of the Group and of the Fund consists of net debt (borrowings as detailed in Note 18) offset by cash and cash equivalents and unitholders’ fund of the Group and of the Fund (comprising unitholders’ capital and undistributed income). Gearing ratios are calculated based on the proportion of total borrowings to the total asset value in accordance with Securities Commission Malaysia (“SC”) Guidelines. On 12 August 2020, the SC announced that it will temporarily increase the gearing limit for Malaysian REITs from 50% to 60%, effective immediately until 31 December 2022. Notwithstanding, the Fund’s total borrowings may exceed this limit with the sanction of the unit holders by way of an ordinary resolution. The Manager’s risk management committee reviews the capital structure of the Group and of the Fund on a regular basis to ensure that the SC Guidelines are complied with. AL-`AQAR HEALTHCARE REIT ANNUAL REPORT 20201 196
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