100 FGV HOLDINGS BERHAD NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2021 23 INTANGIBLE ASSETS (CONTINUED) (a) Impairment test for goodwill (continued) (ii) Palm upstream operations in Malaysia (continued) Financial year ended 31 December 2020 (i) CPO price RM2,450/MT to RM2,809/MT (ii) PK price RM1,500/MT to RM1,800/MT (iii) Average FFB yield 16.3 MT/ha to 26.6 MT/ha (iv) Estate cost Mature estate costs – RM2,761 per hectare to RM3,566 per hectare based on a 25 year cycle for oil palm Immature estate costs – RM4,499 per hectare to RM4,949 per hectare based on a 25 year cycle for oil palm (v) Discount rate 9.5% The Group’s review includes an impact assessment of changes in key assumptions. Based on the sensitivity analysis performed, the Directors concluded that no reasonable change in any of the base case assumptions would cause the carrying amount of the CGU to exceed the recoverable amount. (a) CPO and PK price CPO and PK is determined based on the forecast provided by the Group's trading arm subsidiary, based on historical results and industry trend. (b) Average FFB yield and estate costs The average FFB yield and estate costs are based on forecast provided by the Group's upstream operations management, the Group’s agronomists, based on this Group's approved budget, historical results and industry trend. (c) Discount rate The post-tax discount rate used reflects specific industry risks relating to the palm plantation operations including consideration of comparison with comparable peer companies in Malaysia. (iii) Others Included in others is goodwill of RM6,037,000 (2020: RM6,037,000), which arose from the acquisition of cattle and dairy operations and is allocated to FGV Dairy Farm Sdn Bhd (Note 24(c)(i)). The amount is not deemed to be material to the Group.
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