FGV Annual Report 2013

Felda Global Ventures Holdings Berhad 269 25 PREPAID LEASE PAYMENTS The prepaid lease payments were payment for rights to use the following: Leasehold land 2013 2012 RM’000 RM’000 Cost At 1 January 925 925 Acquisition of subsidiaries 40,404 - 31 December 41,329 925 Accumulated amortisation At 1 January 210 140 Amortisation 150 70 At 31 December 360 210 Net book value 40,969 715 As at 31 December 2013, the carrying amount of prepaid lease lands without title is RM20,392,000 (2012: RM nil). 26 LOAN DUE FROM OTHER RELATED COMPANY Group 2013 2012 RM’000 RM’000 Current: Promissory note 28,869 10,458 Less: Provision for impairment (28,869) (10,458) - - Non-current: Promissory note - 16,494 Less: Provision for impairment - (16,494) - - Total - - The loan due from a related company, Felda Iffco Inc. (“FINA”), a subsidiary of a joint venture, FISB, is denominated in US Dollar, unsecured, charged at market interest rate of 8% (2012: 8%) per annum and was initially repayable in five annual instalments of RM9,309,000 commencing on 30 December 2010. In 2012, FINA notified the Group of its current financial position and requested that for the terms of the promissory note to bemodified by allowing FINA to defer the payment due on 30 December 2012 to 31 December 2012 and to extend the repayment terms of the original promissory note by an additional one year. On 14 January 2013, the Group agreed to these amendments. On 14 January 2014, FISB notified the Group that it had entered into a stock purchase agreement to sell FINA to a third party. As part of the terms of the stock purchase agreement which was executed on 31 January 2014, the promissory note would be settled in full. As at 31 December 2013 and as at 31 December 2012, the loan due from a related company was impaired and fully provided for due to the financial difficulties faced by FINA and the low probability of generating sufficient cash flows to enable repayment in future years.