NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022 11 INVESTMENT IN JOINT VENTURES (CONTINUED) Sensitivity (continued) Reasonably possible changes to the key assumptions would have increased the impairment loss of the investment in a joint venture as follows: Group 2022 2021 RM’000 RM’000 Pre-tax discount rate (1% increase) 577 12 Growth rate for terminal value (1% decrease) - 354 Impairment of investment in joint ventures The movements for allowance for impairment loss on investment in joint ventures during the financial year are as follows: Group 2022 2021 RM’000 RM’000 At 1 January 12,139 8,850 Impairment loss recognised 8,989 3,000 Effect of exchange rate changes 530 289 At 31 December 21,658 12,139 Details of joint ventures are as follows: Group’s effective interest Country of incorporation 2022 % 2021 % Principal activities Boustead Wah Seong Sdn. Bhd. Malaysia 50 50 Investment holding activities and businesses in property development and management; provision of general fabrication, engineering and oil and gas services; trading and marketing activities and any other businesses or projects as shall be mutually agreed from time to time in Myanmar Socotherm Shashi Pipe Coating Co. Ltd. People’s Republic of China 50 50 Dormant Socotherm PPSC Ningbo (Daxie) Pipe Coating Co. Limited People’s Republic of China 50 50 Dormant Sichuan Chuanshi Kanssen (Yadong) Coating Services Company Limited People’s Republic of China 51 51 Provision of pipe coating services Shaanxi Yadong Anti-Corrosion Company Limited People’s Republic of China 55 55 Provision of pipe coating services Wah Seong Corporation Berhad Annual Report 2022 160
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