MSTGOLF Integrated Annual Report 2023

SECTION 4: FINANCIAL PERFORMANCE 152 14 Registration No: 199301009307 (264044-M) Report on the Audit of the Financial Statements (cont’d) Key Audit Matters (cont’d) Inventories valuation The risk As at 31 December 2023, the total inventories of the Group amounted to RM150,636,000 representing 50% and 36% of current assets and total assets respectively. The disclosure for inventories of the Group are included in Note 9 to the financial statements which are subject to a risk that the inventories might become slow-moving or obsolete and rendering them not saleable or can only be sold for selling prices that are less than the carrying value. Judgement is required to access the appropriate level of provision for items which may be ultimately sold below cost. Our response Our audit procedures included, amongst others: - obtained an understanding and reviewed the internal control over the process of the inventories recognition; - attended and observed the inventory counts at selected outlets and performed inventory roll-forward procedures when the inventory counts were performed before financial year end; and - performed costing and net realisable value test to ensure that inventories were correctly valued and stated at lower of cost or net realisable value at the reporting date. - assessed the adequacy of allowance of stock loss and slow-moving inventories by reference to the historical data on sampling basis and discussion with management. Impairment assessment of investment in subsidiaries The risk The Company has balance of investment in subsidiaries of RM71,606,000. On an annual basis, management is required to assess for any indications of impairment to determine if impairment assessment should be carried out.

RkJQdWJsaXNoZXIy NDgzMzc=