Notes to the Financial Statements for the Financial Year Ended 30 September 2024 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People PG. 222 12. INTANGIBLE ASSETS (CONT’D) 12.1 Goodwill (Cont’d) Impairment test of goodwill (Cont’d) Key assumptions used in the value-in-use calculations based on a 6 years (2023: 7 years) cash flows projection in respect of impairment test for goodwill on the plantation segment are: (i) discount rate of 11.0% (2023: 10.0%) which is pre-tax and reflected specific risks of the plantation segment in Indonesia; (ii) oil palm trees with an average life of 25 years (2023: 25 years) with the first three years as immature and remaining years as mature which is the average life cycle of the trees; (iii) crude palm oil (“CPO”) average selling price of RM3,500 (2023: RM3,300) per metric tonne based on the management’s estimate; (iv) average CPO extraction rate of 21.5% (2023: 22.5%) based on the industry trend and past performance; and (v) average annual oil palm yield per hectare of 21 to 25 metric tonnes (2023: 26 metric tonnes) based on management’s estimate and historical yield. In assessing the value-in-use, management does not foresee any possible changes in the above key assumptions that would cause the carrying amounts of the goodwill plus the CGU to materially exceed their recoverable amounts. 12.2 Other intangible assets The Group Capitalised development Development rights Total RM RM RM 2024 At beginning of year 62,774,394 - 62,774,394 Additions (Note 15(c)) - 11,015,954 11,015,954 Written off (Note 6) (2,910,371) - (2,910,371) Amortisation (Note 6) (1,166,138) - (1,166,138) At end of year 58,697,885 11,015,954 69,713,839 2023 At beginning of year 57,069,822 - 57,069,822 Additions 6,294,572 - 6,294,572 Amortisation (Note 6) (590,000) - (590,000) At end of year 62,774,394 - 62,774,394
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