224 NOTES TO THE FINANCIAL STATEMENTS ʹˢ˥ ˧˛˘ Ѓˡ˔ˡ˖˜˔˟ ˬ˘˔˥ ˘ˡ˗˘˗ ʦʤ ʷ˘˖˘ˠ˕˘˥ ʥʣʥʧ (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: (Cont’d) 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 14% - 100% (2023: 17% - 77%) 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 RM34,269 to RM590,841 (2023: RM109,826 to RM3,194,435). (b) Pre-tax operating profit margins of 11% - 51% (2023: 79% - 87%) 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 RM23,428 to RM188,776 (2023: RM6,079 to RM3,006,131). (c) Discount rate of 9% - 12% (2023: 11% - 13%) 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 RM80,645 to RM627,319 (2023: RM126,721 to RM2,832,597). Investment in limited partnership outside Malaysia The investment in limited partnership, Summer Everest Ecosystem Fund, L.P. represents the Group’s subscription for the participating interests in a partnership. The participating interests do not carry any voting rights or any other special rights, but carry the right to distributions if so declared on an ongoing basis as well as to participate in the return of capital upon the dissolution and winding up of the partnership. The fair value of the investment is primarily based on the net asset values of the partnership as the partnership measures and evaluates the performance of substantially all of its investments on a fair value basis. There were no unobservable inputs identified that would require disclosure of sensitivity analysis on possible movements on the fair value of the investment. Material accounting policy information Investment in equity investment are not held for trading. At initial recognition, the Group has irrevocably elect to present subsequent changes in the fair value of the investments in other comprehensive income. This election is made on an investment-by-investment basis. On derecognition, gains and losses accumulated in other comprehensive income are not reclassified to profit or loss. The Group has designated the unquoted equity investments and investment in limited partnership at FVTOCI because the Group intends to hold for long-term strategic purposes.
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