2019 UEM Edgenta Annual Report

203 UEM EDGENTA AT A GLANCE MESSAGE FROM OUR LEADERSHIP STRATEGIC FOCUS OPERATIONAL REVIEW SUSTAINABILITY EFFORTS CORPORATE GOVERNANCE INTRODUCTION FINANCIAL REVIEW ADDITIONAL INFORMATION Notes to the Financial Statements For the year ended 31 December 2019 UEM Edgenta Berhad Annual Report 2019 16. INTANGIBLE ASSETS (CONT’D.) (a) Goodwill (cont’d.) Sensitivity to change in assumption Management believes that no reasonable possible change in any of the above key assumptions would cause the recoverable amount of each of the CGUs to be materially lower than their respective amount, other than the Edgenta UEMS - Malaysia CGU, as follows: Decrease in profit before tax 2019 RM’000 2018 RM’000 Increase in 1% of discount rate 6,614 6,144 Decrease in 1% of terminal growth rate 4,585 5,635 (b) Customer contracts and relationships Customer contracts and relationships arose from the acquisition of EGT Group and Edgenta UEMS Group in 2016 and are amortised over the range of 5 to 15 years. (c) Software and other development cost Computer software represents licenses and other software assets that are not an integral part of property, plant and equipment assets. Software assets are recorded at cost and have finite useful life based on the term of the license or other contractual basis. The cost is amortised over the estimated asset’s useful life of 3 to 5 years. Other development cost relates to the development of a framework for the application of improved processes, systems and services for servicing expressways. 17. INVESTMENT IN SUBSIDIARIES Company 2019 RM’000 2018 RM’000 Unquoted shares, at cost: - Malaysian subsidiaries 2,134,211 2,134,211 - Foreign subsidiaries 86,795 86,795 2,221,006 2,221,006 Less: Accumulated impairment (a) (513,393) (431,963) 1,707,613 1,789,043 Certain unquoted shares in subsidiaries are pledged to financial institutions for facilities granted to the Group and the Company as disclosed in Note 29(a). Further details of the subsidiaries are disclosed in Note 45.