Page 186 - MSM_AR2020

CHAIRMAN’S DELIVERING MSM MANAGEMENT DISCUSSION GROUP FINANCIAL
STATEMENT VALUE OVERVIEW & ANALYSIS REPORT

NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2020

16 LOSS FROM DISCONTINUING OPERATION (CONTINUED)

(iii) Analysis of the cash flows of discontinuing operation is as follows:
2020 2019
RM’000 RM’000
Operating cash flows (14,069) 2,641
Investing cash flows 619 (1,462)
Total cash (outflow)/inflow (13,450) 1,179

184 (iv) Loss before taxation from discontinuing operation is stated after charging/(crediting):
2020 2019
MSM MALAYSIA HOLDINGS BERHAD Annual Report 2020
RM’000 RM’000
(Reversal of impairment)/Impairment of assets held for sale (1,762) 1,762
Impairment of property, plant and equipment 43,705 -
Impairment of receivables 20 -
Depreciation of property, plant and equipment 2,011 860
Depreciation of right-of-use assets 2,674 891
Property, plant and equipment written-off 27,244 -
Repair and maintenance - 294
Staff costs 307 3,261
Severance cost - 6,500
Legal fees - 660
Inventories written off 177 -
Land assessment charges - 4,140
Gain on disposal of property, plant and equipment (566) -
In the previous year, the recoverability of plantation assets which include leasehold land and bearer plants was
determined based on the offer price received from potential buyer. An impairment of RM1,762,000 was made in the
previous financial year upon reclassification of the asset to Assets Held for Sale from Right-of-Use Assets and Property,
Plant and Equipment.
During the financial year ended 31 December 2020, the Group had exercised its right to rescind the sales and purchase
agreement previously entered to dispose its plantation assets. Pursuant to this, the related assets were reclassified from
Assets Held for Sale to Property, Plant and Equipment and Right-of-Use Assets and continued to be depreciated.
In the financial year ended 31 December 2020, the Group has performed a valuation exercise on its assets. Pursuant to
the valuation exercise, the Group has reversed an impairment charge of RM1,762,000 recorded previously.

The fair value is within Level 2 of the fair value hierarchy as this is based on comparison of prices for similar assets.