2020 UEM Edgenta Annual Report

34. RIGHT-OF-USE ASSETS AND LEASE LIABILITIES The Group has lease contracts for leasehold land, office premises and motor vehicles used in its operations. Leases of premises generally have lease terms between 2 and 15 years, while motor vehicles have lease terms between 2 to 3 years. The Group has several lease contracts that include extension and termination options. These options are negotiated by management to provide flexibility in managing the leased-asset portfolio and align with the Group’s business needs. Management exercises judgement in determining whether these extension and termination options are reasonably certain to be exercised. The Group also has leases with lease terms of 12 months or less and leases of office equipment with low value. The Group applies the ‘short-term lease’ and ‘lease of low-value assets’ recognition exemptions for these leases. Set out below are the carrying amounts of right-of-use assets recognised and the movements during the year: Group RM’000 Leasehold land Office Premises Motor Vehicles Total As at 1 January 2020 4,987 25,440 510 30,937 Additions – 41,915 44 41,959 Depreciation (Note 7) (169) (10,877) (281) (11,327) Derecognition – (20,616) – (20,616) Foreign exchange differences – (126) – (126) As at 31 December 2020 4,818 35,736 273 40,827 As at 1 January 2019 5,941 32,024 115 38,080 Additions – 4,604 728 5,332 Depreciation (Note 7) (112) (9,605) (333) (10,050) Disposal of a subsidiary (842) – – (842) Derecognition – (1,659) – (1,659) Foreign exchange differences – 76 – 76 As at 31 December 2019 4,987 25,440 510 30,937 UEM EDGENTA BERHAD 278 Financial Statements NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 December 2020