Serba Dinamik Annual Report 2021

Registration No: 201501042584 (1167905-P) Serba Dinamik Holdings Berhad (Incorporated in Malaysia) 87 11. Intangible assets (continued) Development land rights Development land right is exclusive rights granted by a third party to one of the subsidiaries of the Group, Get Development Sdn. Bhd. (“GDSB”), to jointly develop a land located at Sri Hartamas and to construct and erect thereon the buildings structure in accordance with the approved plans in the manner stipulated in the Joint Development Agreement between the third party and GDSB. Development land rights is not amortised until the commencement of the development on the land. Impairment testing for cash-generating units containing goodwill For the purpose of impairment testing, goodwill is allocated to the Group’s operating activities which represent the lowest level within the Group at which the goodwill is monitored for internal management purposes. Goodwill arising from business combination has been allocated to three individual cash- generating units (“CGUs”) for impairment testing as follows: Group 30.6.2021 31.12.2019 RM'000 RM'000 Segment Operations and maintenance 10,175 6,655 Engineering, procurement, construction and commissioning 2,882 2,882 Information and communication technology 1,696 1,696 Education and training 17,995 - 32,748 11,233 The recoverable amount of a CGU is determined based on value in use calculations using cash flow projections based on financial budgets approved by management covering a 5-year period. The calculations of value in use for the CGUs are most sensitive to the following assumptions: (i) Gross margin The basis used to determine the value assigned to the gross margin is based on past experience, actual operating results and the 5-year business plan. (ii) Revenue growth The basis used to determine the revenue growth is based on past experience, actual operating results and the 5-year business plan. The anticipated annual revenue growth included in the cash flow projections is within the growth levels experienced by the CGU in the past.