FGV Annual Report 2015

256 Notes to the Financial Statements For The Financial Year Ended 31 December 2015 Felda Global Ventures Holdings Berhad Annual Integrated Report 2015 21 INTANGIBLE ASSETS (CONTINUED) (a) Impairment test for goodwill (continued) (ii) Palm upstream operations in Malaysia (continued) The recoverable amount of the CGU is determined using a fair value less cost to sell calculation (Level 3 fair value computation) using cash flow projections based on financial budgets covering a 25 year period approved by the Directors. The key assumptions are as follows: Financial year ended 31 December 2015 (i) CPO price RM2,000/MT to RM2,630/MT (ii) FFB price RM450/MT to RM550/MT (iii) Estate replanting fixed cost Matured – RM2,580 per hectare based on a 25 year cycle for oil palm Immature – RM6,436 (per hectare based on a 25 year cycle for oil palm (iv) Discount rate 9.5% Financial year ended 31 December 2014 (i) CPO price RM2,450/MT to RM2,630/MT (ii) FFB price RM509/MT to RM550/MT (iii) Estate replanting fixed cost Matured – RM2,580 per hectare based on a 25 year cycle for oil palm Immature – RM6,346 (per hectare based on a 25 year cycle for oil palm (iv) 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.