NOTES TO THE FINANCIAL STATEMENTS For the financial year ended 31 December 2022 (cont’d) FINANCIAL STATEMENTS 12. Other investments (CONT’D) The details of significant unobservable inputs of material investments under level 3 fair value measurement relating to Entity A, B, C, H, I and K are as follows: (cont’d) Investment in an entity engaged in providing debt collection system, telecommunication services, computer software, hardware and related accessories (Entity C) Unobservable inputs Relationship of unobservable inputs to fair value Sensitivity analysis assume all other variables held constant (aa) Revenue growth rates of 9% (2021 - 9%) Based on management’s experience and knowledge of market conditions of the specific industries. The higher the revenue growth rate, the higher the fair value. A 1% change in revenue growth rate would result in an increase/decrease in fair value by RM3,270,310 (2021: RM677,000). (bb) Pre-tax operating profit margins of 42% (2021 - 76%) Taking into account management’s experience and knowledge of market conditions of the specific industries. The higher the pre-tax operating margins, the higher the fair value. A 1% change in pre-tax operating profit margin result in an increase/ decrease in the fair value by RM4,154,475 (2021: RM233,000). (cc) Discount rate of 14% (2021 - 14%) Reflects current market assessments of the uncertainty in the amount and timing of cash flows. The higher the discount rate, the lower the fair value. A 1% change in discount rate would result in a decrease/increase in the fair value by RM4,432,623 (2021: RM297,000). Investment in an entity engaged in providing shared telecommunication infrastructure for rent by telecommunication operators, site acquisition and construction of telecommunication infrastructure (Entity H) Unobservable inputs Relationship of unobservable inputs to fair value Sensitivity analysis assume all other variables held constant (aa) Revenue growth rates of 22% (2021 - 17%) Based on management’s experience and knowledge of market conditions of the specific industries. The higher the revenue growth rate, the higher the fair value. A 1% change in revenue growth rate would result in an increase/decrease in fair value by RM4,294,233 (2021: RM740,000). (bb) Pre-tax operating profit margins of 75% (2021 - 73%) Taking into account management’s experience and knowledge of market conditions of the specific industries. The higher the pre-tax operating margins, the higher the fair value. A 1% change in pre-tax operating profit margin result in an increase/ decrease in the fair value by RM3,961,841 (2021: RM181,000). (cc) Discount rate of 18% (2021 - 17%) Reflects current market assessments of the uncertainty in the amount and timing of cash flows. The higher the discount rate, the lower the fair value. A 1% change in discount rate would result in a decrease/increase in the fair value by RM3,881,835 (2021: RM311,000). 207
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