FGV Annual Report 2014

44 Loans due to a Significant Shareholder (continued) Effective finance rate for the loan is as follows: Group and Company 2014 2013 Finance rate Effective finance rate at date of statement of financial position % per annum Finance rate Effective finance rate at date of statement of financial position % per annum Loans due to a significant shareholder Fixed 4.805 Fixed 4.955 The carrying amounts and fair value of the non-current and current loans due to a significant shareholder are as follows: Group and Company Carrying amount Fair value 2014 2013 2014 2013 RM’000 RM’000 RM’000 RM’000 Loans due to a significant shareholder 2,202,920 2,697,790 2,210,231 2,703,437 The fair value of loans due to a significant shareholder is based on cash flows discounted using a rate based on the borrowing rate of 4.72% (2013: 4.84%). The fair value of the loans due to a significant shareholder is a Level 2 computation. 45 Land Lease Agreement (“LLA”) Liability The land lease agreement liability is calculated based on the terms set out in the various agreements as follows: (i) Land Lease Agreement (“LLA”) The Company entered into an agreement with FELDA on 1 November 2011 to lease for a period of 99 years; (i) land with individual land titles issued to FELDA as the registered owner; (ii) existing land granted to FELDA for development but where individual land titles have not been issued to FELDA; and (iii) other land to be alienated or to be acquired by FELDA in the future. FELDA may terminate lease on certain land as follows: (a) Land with minerals, as the rights for minerals are excluded from the lease; (b) Acquisition or intended acquisition under the Land Acquisition Act, 1960 (“LAA”), notice of reclamation by the relevant authority or such other notice of a similar nature issued pursuant to any legislation of Malaysia. Introduction Performance Highlights About FGV Reports Financial Statements Others Strategy and Value Creation Performance Review & Progress Foreword to Shareholders Annual General Meeting Annual Report 2014 pg 299