ENRA Group Berhad Annual Report 2018

79 A N N U A L R E P O R T 2 0 1 8 NOTES TO THE FINANCIAL STATEMENTS 31 March 2018 cont’d 7. INVESTMENT IN AN ASSOCIATE (Cont’d) The summarised financial information of the associate is as follows: Group 2018 2017 RM’000 RM’000 Assets and liabilities Total assets 430 22 Total liabilities (763) (286) Results Revenue - - Loss for the financial year (67) (313) Details of the associate is as follow: Name of company Effective interest in equity Principal activities 2018 2017 % % Perunding ENRA Sdn. Bhd. 30 30 Project management and engineering, procurement and construction contracts Associates are entities, including unincorporated entities, in which the Group has significant influence, but not control or joint control, over the financial and operating policy decisions. Investments in associates are accounted for in the consolidated financial statements using the equity method less any impairment losses. The consolidated financial statements include the Group’s share of the profit or loss and other comprehensive income of the equity accounted associates, after adjustments, if any, to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases. When the Group’s share of losses exceeds its interests in an equity accounted associate, the carrying amount of that interests including any long-term investments is reduced to zero, and the recognition of further losses is discontinued except to the extent that the Group has an obligation or has made payments on behalf of the investee. The Group has recognised its share of losses up to the cost of investment and stopped recognising its remaining share of losses since there is no further obligation in respect of those losses using the equity method of accounting. 8. INVESTMENT IN A JOINT VENTURE On 5 June 2017, ENRA Engineering & Construction Sdn. Bhd. (“EEC”), a wholly-owned subsidiary of the Company and Emrail Sdn. Bhd. had entered into a Shareholders Agreement to jointly establish a company to collaborate on providing total engineering solutions and services, civil works, rolling stock, project and asset management and maintenance services for rail and track transportation projects in Malaysia. Subsequently, ENRA Emrail Sdn. Bhd. (“EEM”) was established on 28 August 2017 with an issued and paid-up share capital of RM100 ordinary shares. EEC holds 51% of the shareholdings of EEM.