- 12 - INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF DESTINI BERHAD (CONT’D) [Registration No: 200301030845 (633265-K)] (Incorporated in Malaysia) Key Audit Matters (Cont’d) Key Audit Matters How we addressed the key audit matters Impairment of goodwill The Group has goodwill amounting to RM67,158,888 as at 31 December 2021 representing approximately 15% of the Group’s total assets as at 31 December 2021. The Company has appointed an independent professional valuer to determine and reassess the recoverable amount of the CGU in accordance with MFRS 136. The impairment tests were significant to our audit due to the complexity of the assessment process involving significant judgements and estimation uncertainty in making key assumptions about future market and economic conditions, terminal growth rates, discount rate, etc. for value in use of CGU based on future discounted cash flows. Our procedures to address this are of focus include, amongst others, the following: • Examining management’s cash flows forecast that support the impairment assessment; • Assessing the reliability of management’s forecast through the review of past trends of actual financial performances against previous forecasted results; • Assessing the key assumptions on which the cash flows projections are based, by amongst others, comparing them against business plans, contracts with customers, historical results and market data; • Evaluating the reasonableness and consistency of key assumptions and inputs used in cash flow projection to available external industry sources of data; • Performing sensitivity analysis to stress test the key assumptions and inputs used in the impairment assessment; and • Assessing the adequacy and reasonableness of the disclosures in the financial statements. 89 ANNUAL REPORT 2021 • DESTINI BERHAD
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