Wah Seong Corporation Berhad Annual Report 2020

157 ANNUAL REPORT 2020 NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2020 19 AMOUNTS OWING BY/(TO) JOINT VENTURES (a) Amounts owing by joint ventures Group 2020 2019 RM’000 RM’000 Current Trade accounts - 1,990 Interest bearing loans - 46,074 Advances 186 1,939 186 50,003 Less: Allowance for impairment loss - (2,200) 186 47,803 Non-current Trade accounts 1,268 - Interest bearing loans 45,431 - Advances 4,282 - 50,981 - Less: Allowance for impairment loss (24,741) - 26,240 - The amounts owing by joint ventures are considered performing except for certain trade account, interest bearing loans and advances owing by joint ventures of RM50,981,000 (2019: RM31,439,000) which is deemed underperforming and hence an ECL allowance of RM23,314,000 (2019: RM2,200,000) was made during the financial year. Trade accounts are unsecured and interest free. The Group’s effective interest rate of interest bearing loans as at 31 December 2020 is between 3.26% to 3.75% (2019: 3.26% to 3.75%) per annum. The loans and advances are unsecured and recoverable on demand. The movements in the allowance for impairment loss on the Group’s amounts owing by joint ventures during the financial year are as follows: Group 2020 2019 RM’000 RM’000 At 1 January 2,200 - Impairment loss recognised 23,314 2,200 Effect of exchange rate changes (773) - At 31 December 24,741 2,200 The Group has no significant exposure to foreign currency risk for the amounts owing by joint ventures except for an amount of RM16,433,000 (2019: RM33,131,000) denominated in United States Dollar.