FGV HOLDINGS BERHAD | AUDITED FINANCIAL STATEMENTS 2023 79 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2023 5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED) (iii) Impairment of non-financial assets (continued) As a result of the assessment, the Group has recognised a net impairment of RM119,463,000 (2022: RM63,092,000) on certain property, plant and equipment, right-of-use assets intangible assets (other than goodwill), biological assets and assets held for sale. The key assumptions and the sensitivity analysis are as disclosed in Note 19 to the financial statements. Company The Company assessed the impairment of its investments in FGV Integrated Farming Sdn. Bhd, (“FGVIF”) a wholly owned subsidiary, due to projected negative cash flow. The recoverable amount was determined based on value in use of the investment, computed based on the net present value of the projected future cash flows derived from the CGU discounted at 7%. Based on the value in use assessment, the recoverable amount was nil, which resulted in the impairment loss of RM15,000,000 in the carrying value of the Company’s investment in FGVIF. (iv) Deferred tax assets Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. This involves judgment regarding the future financial performance of the particular entity in which the deferred tax asset has been recognised. As at 31 December 2023, the Group has deferred tax assets of RM388,322,000 (2022: RM324,223,000) in respect of unused tax losses and deductible temporary differences of certain loss making subsidiaries of the Group. In evaluating whether it is probable that future taxable profits will be available in future periods, all available evidence was considered, including approved budgets, business plans, and analysis of historical operating results. These forecasts are consistent with those prepared and used internally for business planning and impairment testing purposes.
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