Company: ARBB
Filing Date: 2025-10-31
Form Type: 20-F
Source: 0001213900-25-104705
Chunk: 133

Company: ARB IOT Group Ltd
Filing Date: 2025-10-31
Form: 20-F
Item: Item 19
Chunk 133
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 production
or supply of goods or services to customers. The source codes are initially measure at cost. After initial recognition, source codes are
measured at cost less accumulated amortization and accumulated impairment losses.

Amortization is calculated to write down the cost
of the assets to their residual values on a straight-line basis over their estimated useful lives. The estimated useful lives represent
common life expectancies applied in the various business segments of the Group. The principal annual rates used are between range of10%
to20%.

The computer system is written-off when it is disposed of or when no
future economic benefits are expected from its use or disposal, with any gain or loss recognized in the statements of operations and other
comprehensive loss.

Goodwill

Goodwill recognized in a business combination
is an asset at the acquisition date and is initially measured at cost. After initial recognition, goodwill is measured at cost less accumulated
impairment losses.

For the purpose of impairment testing, goodwill
impairment is assessed at least annually and whenever there are indicator of impairment. Goodwill is allocated to the Group’s CGUs
which represent the lowest level within the Group at which the goodwill is monitored for internal management purposes.

The recoverable amounts of the CGUs have been
determined based on value in use (“ VIU”) calculations. The VIU is calculated using the pre-tax cash flow projections based
on financial budgets approved by management covering a five-year followed by a long-term growth rate of9%. VIU was determined by discounting
the future cash flow generated from the business operation of the CGUs.

The calculations of VIU for the CGUs are most
sensitive to the following assumptions:

  (i)      Revenue growth rates  

The forecasted growth rates are determined based on past performance
of the CGUs.

  (ii)      Expenses growth rate  

Expenses are projected at annual increase of approximately3.0% (2024: 3.0%) per annum.

  (iii)      Pre-tax discount rates  

Pre-tax discount rate of11.34% to13.20% (2024: 5.12%) per annum has
been applied in determining the recoverable amount of the CGUs.

  (iv)      Profit margin  

Profit margins are projected based on the historical
profit margin achieved or predetermined profit margin for the CGUs.

With regards to the assessment of the value-in-use
of the CGU relating to goodwill, intangible assets and property, plant and equipment,