Investor Presentaiton
HKAS 1.51(a)
HKAS 1.49
HK Listco Ltd
Financial statements for the year ended 31 December 2023
HKFRS 13.93(c), (e)(iv)
HKAS 16.77
HKAS 40.75(a), (e)
HKFRS 13.93(g)
HKFRS 13.93(d)
(ii)
During the year ended 31 December 2023, there were no transfers between Level 1 and Level 2, or transfers
into or out of Level 3 (2022: nil). The group's policy is to recognise transfers between levels of fair value
hierarchy as at the end of the reporting period in which they occur. 166
All of the group's investment properties and properties held for own use were revalued as at 31 December
2023167. The valuations were carried out by an independent firm of surveyors, Lang and Associates, who
have among their staff Fellows of the Hong Kong Institute of Surveyors with recent experience in the location
and category of property being valued 168. The group's property manager and the chief financial officer have
discussion with the surveyors on the valuation assumptions and valuation results when the valuation is
performed at each interim and annual reporting date 169.
Valuation techniques and inputs used in Level 2 fair value measurements 170
The fair value of investment properties and properties held for own use located in Hong Kong is determined
using market comparison approach by reference to recent sales price of comparable properties on a price
per square foot basis using market data which is publicly available.
HKFRS 13.93(d)
(iii)
Information about Level 3 fair value measurements 170
Valuation
techniques
Unobservable input
Range 171
Weighted
average 171
Investment properties Residential
- Chinese Mainland
Discounted
cash flow
Risk-adjusted discount
1% to
1%
rate
Expected market
rental growth
Expected occupancy
rate
(2022:
1% to
1%)
]%
(2022: ]%)
1% to []%
1%
%
(2022:
1% to
1%)
(2022: ]%)
1% to
1%
(2022:
1% to
]%)
1%
(2022: ]%)
Properties held for own use
Freehold land and buildings
South East Asia
Market
comparison
approach
Premium (discount)
on quality of the
buildings
1% to
1%
1%
(2022: []% to [●]%)
(2022: ]%)
HKFRS 13.93(h)(i)
HKFRS 13.93(c),
93(e)(iv) & 95.
166
HKFRS 13.27-29,
93(i)
167
The fair value of investment properties located in Chinese Mainland is determined by discounting a
projected cash flow series associated with the properties using risk-adjusted discount rates. The valuation
takes into account expected market rental growth and occupancy rate of the respective properties. The
discount rates used have been adjusted for the quality and location of the buildings and the tenant credit
quality. The fair value measurement is positively correlated to the expected market rental growth and the
occupancy rate, and negatively correlated to the risk-adjusted discount rates 172.
The fair value of properties held for own use located in South East Asia is determined using market
comparison approach by reference to recent sales price of comparable properties on a price per square foot
basis, adjusted for a premium or a discount specific to the quality of the group's buildings compared to the
recent sales. Higher premium for higher quality buildings will result in a higher fair value measurement.
Entities are required to disclose the following in respect of recurring fair value measurements:
the amounts of any transfers between levels of the fair value hierarchy;
the reasons for those transfers; and
the policy for determining when transfers between levels are deemed to have occurred (e.g. occurred at the date of the event
or change in circumstances that caused the transfer, deemed to have occurred at the beginning of the reporting period, or at
the end of the reporting period).
Transfers into and out of the levels should be separately disclosed and discussed.
Under HKFRS 13, fair value measurement takes into account a market participant's ability to generate economic benefits by using the
asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. An
entity's current use of a non-financial asset is presumed to be its highest and best use unless market or other factors suggest that a
different use by market participants would maximise the value of the asset. If it is determined that the highest and best use of a
non-financial asset differs from its current use, the entity is required to disclose this fact and why the non-financial asset is being
used in a manner that differs from its highest and best use. This disclosure requirement applies to both recurring and non-recurring
fair value measurements.
106
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