ANNUAL REPORT 2021 203 FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS ʹˢ˥ ˧˛˘ Ѓˡ˔ˡ˖˜˔˟ ˬ˘˔˥ ˘ˡ˗˘˗ ʦʤ ʷ˘˖˘ˠ˕˘˥ ʥʣʥʤ (CONT’D) 11. OTHER INVESTMENTS (CONT’D) Investment in an entity engaged in the provision of national security solutions which involves the provision of its own security technology intellectual property to its customers as well as the development and customisation of solutions and systems (Entity I) Unobservable Inputs Relationship of Unobservable Inputs to Fair Value Sensitivity Analysis (Assume All Other Variables Held Constant) (aa) Revenue growth rates of 198% Based on information on current and tendered projects by the entity. The higher the revenue growth rate, the higher the fair value. A 1% change in revenue growth rate would result in an increase/decrease in the fair value by RM45,291,000. (bb) Pre-tax operating profit margins of 40% Taking into account management’s experience and knowledge of market conditions of the specific industries. The higher the pre-tax operating margins, the higher the fair value. A 1% in pre-tax operating profit margin would result in an increase/decrease in the fair value by RM4,660,000. (cc) Discount rate of 17% Reflects current market assessments of the uncertainty in the amount and timing of cash flows. The higher the discount rate, the lower the fair value. A 1% change in discount rate would result in a decrease/ increase in the fair value by RM13,059,000. Investment in an entity engaged in blockchain technology and software development (Entity K) Unobservable Inputs Relationship of Unobservable Inputs to Fair Value Sensitivity Analysis (Assume All Other Variables Held Constant) (aa) Revenue growth rates of 88% Based on management’s experience and knowledge of market conditions of the specific industries. The higher the revenue growth rate, the higher the fair value. A 1% change in revenue growth rate would result in an increase/decrease in the fair value by RM500,000. (bb) Pre-tax operating profit margins of 73% Taking into account management’s experience and knowledge of market conditions of the specific industries. The higher the pre-tax operating margins, the higher the fair value. A 1% in pre-tax operating profit margin would result in an increase/decrease in the fair value by RM186,000. (cc) Discount rate of 20% Reflects current market assessments of the uncertainty in the amount and timing of cash flows. The higher the discount rate, the lower the fair value. A 1% change in discount rate would result in a decrease/ increase in the fair value by RM545,000.
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