NOTES TO THE FINANCIAL STATEMENTS For the Financial Year Ended 31 December 2023 (cont’d) 11. OTHER INVESTMENTS (CONT’D) The details of significant unobservable inputs of material investments under level 3 fair value measurement relating to unquoted investments are as follows: Unquoted shares in Malaysia Unobservable inputs Relationship of unobservable inputs to fair value Sensitivity analysis assume all other variables held constant (a) Revenue growth rates of 16% - 693% (2022: 8% - 212%) 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 RM628,527 to RM11,644,534 (2022: RM76,849 to RM4,294,233). (b) Pre-tax operating profit margins of 35% - 70% (2022: 42% - 75%) 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 RM502,075 to RM7,538,468 (2022: RM482,348 to RM4,154,475). (c) Discount rate of 11% - 13% (2022: 14% - 31%) Determined using a Capital Asset Pricing Model. 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 RM365,154 to RM2,725,726 (2022: RM650,164 to RM8,333,844). Unquoted shares outside Malaysia Unobservable Inputs Relationship of unobservable inputs to fair value Sensitivity analysis assume all other variables held constant (a) Revenue growth rates of 17% - 77% (2022: 85%) 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 RM109,826 to RM3,194,435 (2022: RM94,083). (b) Pre-tax operating profit margins of 79% - 87% (2022: 85%) 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 RM6,079 to RM3,006,131 (2022: RM295,878). (c) Discount rate of 11% - 13% (2022: 38%) Determined using a Capital Asset Pricing Model. 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 RM126,721 to RM2,832,597 (2022: RM507,496). ANNUAL REPORT 2023 215 y y growth rate the higher FINANCIAL STATEMENTS
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