32.
FAIR VALUE OF FINANCIAL INSTRUMENTS
GROUP AND COMPANY
The carrying amounts of financial assets and financial liabilities (other than derivatives financial instrument)
of the Group and of the Company approximate their fair values, either due to their short-term nature or
that they are floating rate instruments that are re-priced to market interest rates on or near the end of the
reporting period.
The carrying amounts of the non-current portion of finance lease liabilities are reasonable approximation
of fair values due to their insignificant impact of discounting.
32.1
Foreign currency forward contracts
The Group classifies the derivative financial liabilities arising from the fair value changes on the
foreign currency forward contracts under level 2 of the fair value hierarchy. (Refer to Note 2.2 to the
financial statements for definition of the fair value/hierarchy table.) Fair value is determined on the
basis of foreign exchange rates which are observed on the market, discounted for the remaining term.
33.
EVENTS AFTER REPORTING PERIOD
33.1
Closure of foreign subsidiary
On 27 January 2015, Pentamaster Automation Engineering (Shanghai) Co. Ltd. (“PMAE”), a wholly-
owned subsidiary of the Group has commenced members’ voluntary closure proceedings in the
People’s Republic of China which was successfully completed on 13 February 2015. The closure of
PMAE did not have any significant financial and operational impact to the Group.
33.2
Acquisition of leasehold land
The Group has via its wholly-owned subsidiary, Pentamaster Technology (M) Sdn. Bhd. entered into
a Sale and Purchase Agreement (“SPA”) on 19 March 2015 with a third party to acquire a piece of
leasehold land for a cash consideration of RM5,015,490. As at the date of this report, the transaction
is yet to be completed.
NOTES TO THE FINANCIAL STATEMENTS
31 DECEMBER 2014 (CONT’D)
•
Pentamaster Corporation Berhad
(572307-U)
Annual Report 2014
89
