226 NOTES TO THE FINANCIAL STATEMENTS (CONT’D) For the financial year ended 31 January 2023 YINSON HOLDINGS BERHAD | INTEGRATED ANNUAL REPORT 2023 5. Critical accounting estimates and judgements (continued) (d) Residual value of an FPSO and OSVs The Group reviews the residual value of FPSOs and OSVs at each reporting date based on factors such as business plans and strategies, expected level of usage and future technological developments. A reduction in the residual value of an FPSO and OSVs would increase the recorded depreciation and decrease the carrying value of an FPSO and OSVs. The net book value of an FPSO and OSVs as at 31 January 2023 was RM3,111 million in Note 16. For the financial year ended 31 January 2023, the impact of the sensitivity resulting from a 10% increase/ decrease in estimated residual value of an FPSO and OSVs on the expected carrying value of property, plant and equipment and the depreciation expense charged to profit or loss annually are analysed as follows: Carrying value of property, plant and equipment Group RM million Depreciation expense Group RM million Residual value - Increase by 10% 3,100 192 - Decrease by 10% 3,095 198 (e) Share-based compensation plans The salient terms and conditions of the LTIP are set out in Note 29(b) The final number of Yinson Shares or cash performance bonuses to be awarded will depend on the achievement of pre-determined target points for daily share price and Award Conditions over a four-year performance period, and is subject to approval by the Employees’ Share Scheme Committee and the Board of Directors of the Company. No Yinson Shares or cash performance bonuses will be awarded if the share price targets and Award Conditions are not met at each annual assessment date within the performance period. Significant judgement is required to determine whether the target points for daily share price and Award Conditions are expected to be achieved at each annual assessment date within the performance period, and correspondingly, the number of Yinson Shares or cash performance bonuses to be awarded. During the financial year, the Group and the Company revised its assumptions on the achievement of specific target points for daily share price under the LTIP. This resulted in a reversal of LTIP expenses of RM38 million and RM11 million for the Share Award Scheme respectively and RM26 million and RM26 million for the Performance Bonus Scheme respectively (Note 29(c)).
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