Sasbadi Annual Report 2019

PAGE 94 SASBADI HOLDINGS BERHAD FINANCIAL STATEMENTS (continued) 4. Investment properties Buildings RM’000 Group Cost At 1 September 2017/31 August 2018/1 September 2018/ 31 August 2019 2,640 Accumulated depreciation At 1 September 2017 56 Charge for the year 52 At 31 August 2018/1 September 2018 108 Charge for the year 52 At 31 August 2019 160 Carrying amounts At 1 September 2017 2,584 At 31 August 2018/1 September 2018 2,532 At 31 August 2019 2,480 Investment properties comprise of commercial buildings that are leased to third parties. Each of the lease contains an initial non-cancellable period of 3 years. Subsequent renewals are negotiated with the lessees with an average renewal period of 2 years. No contingent rents are charged. The investment properties of the Group are charged to banks as security for banking facilities granted to the Group (see Note 15). The following are recognised in profit or loss in respect of investment properties: Group 2019 2018 RM’000 RM’000 Rental income 118 105 Direct operating expenses (14) (74) Fair value information Fair value of the investment properties are categorised as follows: Group Level 3 2019 2018 RM’000 RM’000 Commercial buildings 2,680 2,680