Impairment testing of goodwill Refer to Notes 3 (m) and 15 to the consolidated financial statements The Key Audit Matter How the matter was addressed in the audit The Group has significant amounts of goodwill arising from business combinations in the past. Cash generated uni ts (CGUs), in which goodwi l l is embedded is tested annually for impairment. The Group determines the recoverable amount of each CGU, in which goodwill is embedded by applying the value-in-use method (the discounted cash flow method). Loss on impairment shall be recognised when the recoverable amount is less than the carrying amount. As the amount is material and significant judgement is involved in the estimation of future cash flows attributable to each CGU, and evaluation of the appropr iate discount rate, I considered the measurement of the recoverable amount to be a key audit matter. Key audit procedures included: Understanding management’s processes in testing for impairment and estimating expected future cash flows and key assumptions used; Evaluating the appropriateness of the forecasting of financial performances by comparing historical estimate to the actual operating results; Testing management’s key assumptions used in estimating present value of expected future cash flows by referring to market situations, operating environment, knowledge of the industry as well as other obtained information; Evaluating the appropriateness of the valuation method and financial parameters used in setting out the discount rate, including testing the calculation; and Evaluating the adequacy of the disclosures in accordance with relevant Thai Financial Reporting Standards. The measurement of inventories valuation Refer to Notes 3 (g) and 8 to the consolidated and separate financial statements The Key Audit Matter How the matter was addressed in the audit Inventories of the Group and the Company are significant balances to the consolidated and separate financial statements. The raw materials and finished goods are commodities that contain significant price volatility which may cause the net realisable value to be lower than its cost resulting in an inventory writedown. I considered this as a key audit matter. Key audit procedures included: Gaining an understanding and performing tests of design and implementation as well as operating effectiveness of the relevant controls over the inventories valuation measurement process; Assessing the appropriateness of the methodology used to calculate the net realisable value of inventories at the reporting period, considering the reasonableness of the market prices used by reference to expected selling price of commodity, and testing the accuracy of the calculation; and Assessing the adequacy of the disclosure in relation to the estimation of allowance for diminution in value of inventories in notes to the financial statements. 244
RkJQdWJsaXNoZXIy ODg4NTI=