198 AL-SALAM REIT 19. Management Expense Ratio (‘MER’) Group and Fund 2022 % 2021 % MER 0.69 0.63 The calculation of MER is based on the total fees of the Fund incurred for the year, including the Manager’s fees, Trustee’s fees, audit fee, tax agent’s fee and administrative expenses, to the average net asset value of the Fund during the year calculated on a monthly basis. Since the average net asset value is calculated on a monthly basis, comparison of the MER of the Fund with other Real Estate Investment Trusts (“REIT”) which use a different basis of calculation may not be an accurate comparison. 20. Significant related party transactions For the purposes of these have financial statements, related companies are considered to be related to the Group and the Fund if the Group and the Fund have the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group and the Fund and the party are subject to common control or common significant influence. Related parties may be individuals or other entities. Significant related party transactions other than those separately disclosed elsewhere in the financial statements are as follows: Group Fund 2022 RM 2021 RM 2022 RM 2021 RM Rental income received/receivable from related companies 37,123,527 34,774,595 37,123,527 34,774,595 Other property management fees charged by related companies of the Manager (including in other operating expenses) 5,669,715 5,902,509 5,669,715 5,902,509 Finance cost paid/payable to a subsidiary - - 19,505,069 19,335,023 The related party transactions described above were entered into in the normal course of business and are based on negotiated and mutually agreed terms. NOTES TO THE FINANCIAL STATEMENTS 31 December 2022 (cont’d.)
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