162 FGV HOLDINGS BERHAD NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2022 47 PROVISION FOR ASSET RETIREMENT Group 2022 RM’000 2021 RM’000 At 1 January 42,015 33,001 (Reversal of provision)/provision for the year (10,116) 8,245 Unwinding of discount 421 447 Payment made during the financial year (26) (10) Currency translation differences 527 332 At 31 December 32,821 42,015 Provision for asset retirement mainly relates to the Group’s fatty acids manufacturing facility in USA and mills in Malaysia. The asset retirement obligation is computed based on detailed estimates, adjusted for inflation, escalated to the estimated spending dates, and then discounted using an average risk-free interest rate of which represents management’s best estimate of the liability. Actual costs to be incurred in future periods may vary from estimates, given the inherent uncertainties in evaluating certain exposures subject to the imprecision in estimating the asset retirement obligation. Group 2022 RM’000 2021 RM’000 Analysed as: Non-current 32,119 41,349 Current 702 666 32,821 42,015 48 PROVISION FOR DEFINED BENEFIT PLAN The Group operates defined benefit retirement plans in Malaysia, Thailand and Indonesia for all eligible employees. All of the plans are lump sum payments depending on members’ length of service and their salary in the final years leading up to retirement. As the retirement benefit plans are unfunded, the Group meets the defined benefit payment obligations as they fall due. Group Company 2022 RM’000 2021 RM’000 2022 RM’000 2021 RM’000 Non-current - Retirement benefit scheme 26,709 28,513 480 535 - Housing assistance scheme 17,573 18,567 - - - Long service award 3,699 4,056 88 97 47,981 51,136 568 632
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