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Annual Report 2016
ASIA MEDIA GROUP Berhad
97
Notes to the Financial Statements
(continued)
5.
Property, plant and equipment (cont’d)
During the current financial year, a subsidiary carried out a review of the recoverable amounts
of the following assets as the subsidiary has been persistently making losses. The recoverable
amounts of these assets were determined based on value in use.
a) Capital work in progress, broadcasting centre, network and SMS gateway (“Broadcasting
Infrastructure”) & other intangible assets (“Broadcasting Licences”)
Broadcasting Broadcasting
Total
infrastructure
licences
(Note 6)
RM
RM
RM
Cost at end of the
financial year
121,193,953 2,367,750 123,561,703
Less:
Accumulated depreciation/
amortisation at the end
of the financial year
(31,779,909)
(1,257,934) (33,037,843)
Accumulated impairment at
the end of the financial year
(70,548,469)
(887,639) (71,436,108)
18,865,575
222,177 19,087,752
Less: Impairment loss for the
financial year (Note 17)
(2,806,005)
(33,031) (2,839,036)
Carrying amount at end of the
financial year
16,059,570
189,146 16,248,716
Broadcasting Infrastructure and Broadcasting Licences were classified as one combined
CGU (“Combined CGU”) and were tested for impairment. Following the review of projected
cash flows, the Combined CGU is not expected to generate sufficient cash flows in the next
four years. Consequently, a total impairment loss of RM2,839,036 (2015: RM71,436,108)
was provided as the carrying amount was in excess than its recoverable amount.
The recoverable amount was determined based on the value-in-use (“VIU”), was determined
by the management. Cash flows are derived based on financial forecast covering a period
of four (4) years which reflect management’s expectations of revenue growth, operating
costs, ability for successful launching of live broadcasting in year 2017 and EBITDAmargin
for the CGUs based on expectation of market growth, industry growth and future business
performance.