Page 175 - S P Setia Annual Report 2013
P. 175

Annual Report 2013 S P SETIA BERHAD GROUP Financial Statements | 173





NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 OCTOBER 2013 (CONT’D)






46. FaiR ValUe OF Financial inStRUmentS

(a) Determination of Fair Value
The fair value of a fnancial instrument is the amount at which the instrument could be exchanged or settled between knowledgeable
and willing parties in an arm’s length transaction, other than in forced or liquidation sale.
The carrying amounts of the fnancial assets and liabilities of the Group and of the Company at the reporting date approximated or
were at their fair values except for the following:

Group company
2013 carrying carrying
amount Fair value amount Fair value
Rm’000 Rm’000 Rm’000 Rm’000

Financial assets:
Unquoted cumulative redeemable preference shares - - 96,187 95,447 ^
Amounts owing by subsidiary companies - - 1,653,689 1,651,853 ^
Amount owing by a former joint venture partner 14,380 14,025 - -
Amounts owing by jointly controlled entities 41,569 41,562 138,563 138,540 ^

2012
Financial assets:
Unquoted cumulative redeemable preference shares - - 114,785 114,416 ^
Other investments 337 * - -
Amounts owing by subsidiary companies - - 1,168,459 1,167,893 ^
Amount owing by a former joint venture partner 13,714 13,769 - -
Amounts owing by jointly controlled entities 57,772 57,764 192,574 192,545 ^

* It was not practical to estimate the fair value of the Group’s other investments in unquoted shares due to the lack of comparable
quoted market prices and the inability to estimate fair value without incurring excessive costs.
^ Fair value is calculated based on the present value of future principal and interest cash fows, discounted at the market rate of
interest at the end of the reporting period.
The carrying amounts of the current portion of borrowings are reasonable approximations of fair value due to the insignifcant impact
of discounting.
Long term fnancial liabilities are reasonable approximation of fair values because they are foating rate instruments which are repriced
to market interest rates.
(b) Fair Value Hierarchy

As the fnancial assets and liabilities of the Group and the Company are not carried at fair value by any valuation method, the fair value
hierarchy analysis is not presented.


47. caPital manaGement
The primary objectives of the Group’s and the Company’s capital management are to ensure that it maintains a strong capital base and
healthy capital ratios in order to support its existing business operations and enable future development of the businesses as well as
maximise shareholders’ value.

The capital structure of the Group and the Company consists of equity attributable to the shareholders of the Company (i.e. share capital,
reserves and retained earnings) and total debts, which include borrowings.
   170   171   172   173   174   175   176   177   178   179   180