7 FINANCIAL STATEMENTS 323 17. INTANGIBLE ASSETS (CONTD.) (a) Goodwill (contd.) Key assumptions used in VIU calculation (contd.) The calculation of the VIU 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 Other than the CGUs that were impaired above, the Board of Directors 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. (b) Customer contracts and relationships Customer contracts and relationships arose from the acquisition of Kaizen Group, MEEM, EGT Group and Edgenta UEMS Group are amortised over the range of 4.75 to 15 years (2024: 11 months to 15 years). (c) Software and other development cost Computer software represents licenses and other software assets that are not an integral part of property, plant and equipment assets. Software assets are recorded at cost and have finite useful life based on the term of the license or other contractual basis. The cost is amortised over the estimated asset’s useful life of 3 to 10 years (2024: between 3 to 10 years). Other development cost relates to the development of a framework for the application of improved processes, systems and services for servicing expressways. 18. INVESTMENT IN SUBSIDIARIES Company 2025 RM’000 2024 RM’000 Unquoted shares, at cost (Note (a)): - Malaysian subsidiaries 1,871,259 1,871,259 - Foreign subsidiaries 217,915 217,915 2,089,174 2,089,174 Less: Accumulated impairment (Note (b)) (674,945) (381,135) 1,414,229 1,708,039
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