Page 205 - UBP - IR2020
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FINANCIAL STATEMENTS
Notes to the financial statements
For the year ended June 30 2020
THE GROUP
(10 148) (10 148) 9 9 947
9 (b) LAND CONVERSION RIGHTS
2020
Rs’000
20 095
18 841
38 936
(10 148) (6 851)
(16 999)
21 937
COST
At July 01 Infrastructure costs At June 30 IMPAIRMENT
At July 01 Impairment At June 30 NET BOOK VALUE At June 30 2019 Rs’000
18 624 1 1 471 20 095
-
“The reform of of the the the Sugar Industry in in the the the years 2000 necessitated redundancy payments in in the the the form form of of cash and and serviced land as as well as as capital capital expenditure expenditure for capacity expansion and and optimisation These capital capital expenditure expenditure investments and and expenses have been financed by debt debt In order to to assist the the the repayment of these debts Government granted a a a a a a a a tax exemption to to the the the Sugar Industry when converting agricultural land land into residential land land in in in the form of Land Conversion Rights (“LCRs”) These LCRs LCRs are
granted by by the the Mauritius Cane Industry Authority (MCIA) based on the the qualifying costs incurred by by an an an entity LCR is is is is recognised as as as a a a a a a a a a a a a non-current asset and is is is is initially measured at at at fair value at at at the the date on on which the the Company is is is is entitled to receive receive those rights that that is is when there is is reasonable assurance that that the the the LCR will
will
be received and all the the the attached conditions will
will
be complied with LCRs are
tested annually for impairment When the the carrying amount of the the asset is greater than its estimated recoverable recoverable amount amount it it it is is is written down immediately to its recoverable recoverable amount amount LCRs are
derecognised upon disposal (i e e e e e e e e e e e e e e e the date the recipient obtains control) use for for converting agricultural land land land into residential land land land for for land land land projects or or or when no future economic benefits are
expected from fits its use or or or disposal Any gain or or or loss on on on derecognition of o the LCR is is included in in in profit or or or loss At June 30 2020
the the the Directors have have made an an an assessment of of the the the carrying value of of the the the LCRs and have have concluded that an an an impairment of Rs Rs 6 9m (2019: Rs Rs 10 1m) was required The assumptions used in in the the the DCF include the the the average annual conversion rates of agricultural land land to residential land land the the the estimated selling selling price the the the estimated estimated infrastructure cost cost the the the estimated estimated selling selling cost cost and the the the discount discount rate rate The discount discount rate rate calculation is is is based on the the the the specific circumstances of of these rights The level of of the the the the fair fair value value hierarchy within which the the the the fair fair value value measurement is is is categorised is is is level 3 10 INVESTMENT IN IN SUBSIDIARIES
At July 01 Additions (a) Impairment (c) At June 30 Analysed as follows: Unquoted equity instruments Interest free loans
2020
Rs’000
1 042 796
48 707
(81 895)
1 009 608
562 940
446 668
1 009 608
THE COMPANY
2019 Rs’000
1 092 882 24 514 (74 600) 1 042 796
596 128 446 668
1 042 796
UBP INTEGRATED REPORT 2020
-
205
The Directors have assessed the the the the recoverable amount amount of of the the the the investments and are
of of the the the the opinion that the the the the carrying amount amount has not suffered further impairment other than that disclosed in note (b) below FINANCIAL CAPITAL CORPORATE MANAGEMENT STATEMENTS
REPORTS GOVERNANCE APPROACH
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