17. INTANGIBLE ASSETS (CONTD.) (a) Goodwill (contd.) Key assumptions used in value-in-use calculation The discount rates applied to the cash flow projections and the forecasted growth rates used to extrapolate cash flows beyond the projection period are as follows: Projection period Years Pre-tax discount rate Terminal growth rate 2024 % 2023 % 2024 % 2023 % Asset consultancy: Opus Group 5 13.5 13.8 1.0 1.0 Healthcare solutions EMS 11 12.6 13.2 * * Edgenta UEMS Group: – Malaysia 5 10.7 10.6 1.0 1.0 – Singapore 5 10.3 10.0 1.0 1.0 – Taiwan 5 12.2 12.2 1.0 1.0 Property and Facility Solutions: EGT Group 5 8.7 9.0 1.0 1.0 MEEM for Facilities Management Company 5 7.8 7.7 1.0 1.0 Kaizen Group 5 11.1 – 1.0 1.0 Infrastructure services: Edgenta PROPEL Berhad 5 10.0 10.0 1.0 1.0 * For EMS, the value-in-use is determined by discounting cash flows for a period of 11 years (2023: 11 years) with no terminal value. The Board of Directors has applied a 11-year period for computing EMS’s DCF, considering the historical relationship with the customer and the likelihood of contract renewal, despite the shorter contract duration. The calculation of the value-in-use for the CGUs are most sensitive to the following assumptions: (i) Budgeted gross margin The basis used to determine the value assigned to the budgeted gross margins is the average gross margins and average growth rate achieved in the years before the budgeted year, adjusted for market and economic conditions and internal resource efficiency. (ii) Pre-tax discount rate The discount rates reflect the current market assessment of the risks specific to each CGU. This reflected the management’s best estimate of return on capital employed required in the Group. (iii) Terminal growth rate Terminal growth rates used to extrapolate cash flows beyond the budget period is based on published industry research for each business. Sensitivity to change in assumption Management believes that no reasonable possible change in any of the above key assumptions would cause the recoverable amount of each of the CGUs to be materially lower than their respective carrying amounts. Notes to the Financial Statements For the year ended 31 December 2024 323 FINANCIAL STATEMENTS
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