NOTES TO THE FINANCIAL STATEMENTS Cont’d 18. Provisions Employee entitlements (Note 18.1) Restoration and rehabilitation (Note 18.2) Total RM’000 RM’000 RM’000 Group At 1 January 2021 9,296 206,521 215,817 Provisions reversed during the year (40) (21,940) (21,980) Unwinding of discount - 3,678 3,678 Effect of movements in exchange rates (210) (2,794) (3,004) At 31 December 2021/1 January 2022 9,046 185,465 194,511 Provisions made during the year 285 - 285 Provisions reversed during the year - (18,060) (18,060) Unwinding of discount - 5,403 5,403 Effect of movements in exchange rates (132) (2,074) (2,206) At 31 December 2022 9,199 170,734 179,933 2022 Non-current 830 169,687 170,517 Current 8,369 1,047 9,416 9,199 170,734 179,933 2021 Non-current 719 184,628 185,347 Current 8,327 837 9,164 9,046 185,465 194,511 18.1 Employee entitlements The long service leave provision is measured at the present value of expected future payments in respect of services provided by the employees up to the end of the reporting period. Forecast future salary levels, experience of employees, turnover and periods of service are considered in determining the liability. 18.2 Restoration and rehabilitation The provision for restoration and rehabilitation relates to the estimated costs associated with the joint operation’s obligation for decommissioning and demolition of all industrial and support infrastructure from the site and revegetation of the land. The rehabilitation is expected to occur in the next 60 years. Because of the long-term nature of the liability, the greatest uncertainty in estimating the provision is the costs that will be incurred. The provision is the best estimate of the present value of the expenditure required to settle the restoration obligation at the reporting date, based on current legal requirements and technology. The provision has been calculated using a nominal discount rate of 3.7% (2021: 2.9%). Future restoration costs are reviewed annually and any changes are reflected in the present value of the restoration provision at the end of the reporting period. The unwinding of the effect of discounting on provision is recognised as a finance cost. ANNUAL REPORT 2022 264
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