KEY!AUDIT!MATTERS!(CONT’D*) Revenue!and!cost!of!sales!in!respect!of!property!development!activities!(cont’d*) (Refer!to!Note!1!and!Note!/!to!the!financial!statements)!(cont’d') How!have!our!audit!addressed!this!matter To!address!these!areas!of!audit!focus&!we!performed&!amongst!others&!the!following!procedures) • Obtained! an! understanding! of! the! internal! controls! over! the! accuracy! and! timing! of! revenue! recognised! in! the! financial! statements&! including!controls!performed!by!management!in!estimating!the!total!property!development!cost* • Obtained! an! understanding! of! the! internal! control! over! the! timeliness! of! updating! the! gross! development! value! of! each! property! development!project!by!the!management!by!reference!to!the!latest!selling!price* • Read!the!sale!and!purchase!agreements!entered!into!with!the!customers!on!a!sampling!basis!to!obtain!an!understanding!of!the!specific! terms!and!conditions*! • Evaluated!the!assumptions!applied!in!estimating!the!total!property!development!costs!on!a!sampling!basis!by!examining!documentary! evidence!such!as!letters!of!award!issued!to!contractors!to!support!the!total!budgeted!costs'!We!also!considered!the!historical!accuracy!of! management’s!budgets!for!the!similar!property!development!projects!in!evaluating!the!estimated!total!property!development!costs* • Evaluated!the!determination!of!the!progress!towards!complete!satisfaction!of!the!Group’s!performance!obligation!by!examining!supporting! evidence!such!as!contractors’!progress!claims!and!suppliers’!invoices*! • Evaluated!the!mathematical!accuracy!of!the!revenue!and!profit!based!on!the!percentage!of!completion!calculations!and!considered!the! implications!of!identified!errors!and!changes!in!estimates*!and • Observed!the!progress!of!the!property!developments!on!a!sampling!basis!by!performing!site!visit' Valuation!of!investment!properties (Refer!to!Note!$0!to!the!financial!statements) The!carrying!value!of!the!Group’s!investment!properties!as!at!+$!December!"#"+!was!RM$&110&0%%&###&!representing!$%3!and!$"3!of!the! Group’s!total!non-current!assets!and!total!assets!respectively'!The!Group!adopts!fair!value!model!for!its!investment!properties'!When!estimating! the!fair!value!of!a!property&!the!objective!is!to!estimate!the!price!that!would!be!received!from!the!sale!of!the!investment!property!in!an!orderly! transaction!between!market!participants!at!the!reporting!date!under!current!market!conditions'!In!addition&!the!fair!value!should!reflect&! among!other!things&!the!property!related!data!used!as!input!to!the!valuation!model!and!other!assumptions!that!market!participants!would!use! when!pricing!the!investment!property!under!current!market!conditions&!which!are!highly!judgemental'!Accordingly&!we!consider!this!to!be!an! area!of!audit!focus' INDEPENDENT AUDITORS’ REPORT TO!THE!MEMBERS!OF!TROPICANA!CORPORATION!BERHAD!(INCORPORATED!IN!MALAYSIA) 180 ANNUAL REPORT 2023
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