Company: ARBB
Filing Date: 2025-10-31
Form Type: 20-F
Source: 0001213900-25-104705
Chunk: 14

Company: ARB IOT Group Ltd
Filing Date: 2025-10-31
Form: 20-F
Item: Item 3
Chunk 14
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 required
to record impairment charges against the carrying value of our goodwill and other intangible assets in the future.

As of June 30, 2025,
2024 and 2023, we had recorded goodwill and intangible assets with a net book value of RM53.8 million ($12.8 million), RM88.9 million
($18.8 million) and RM116.6 million ($25.0 million), respectively. Besides amortizing intangible assets over 5 to 10 years, we are required
to test for impairment at least annually and whenever evidence of impairment exists.

During the years ended
June 30, 2025, 2024 and 2023, amortization of intangible assets of approximately RM18.9 million ($4.5 million), RM27.9 million ($5.9 million)
and RM22.4 million ($4.8 million) were recorded in our statements of profit or loss, respectively. The carrying value of our goodwill
and intangible asset values are measured using value in use (“ VIU”) calculations and discounted cash flow model, including
significant judgements and assumptions relating to revenue growth rates, projected operating income and expenses and the weighted average
cost of capital (“ WACC”) as the discount rate. We may be required in the future to record impairment charges that could have
a material adverse effect on our reported results.

Our lack of business insurance could expose
us to significant costs and business disruption.

The IoT industry in Malaysia is an emerging sector.
We currently do not have any product liability or disruption insurance to cover our operations in Malaysia, which, based on public information
available to us relating to Malaysia-based IoT companies, is consistent with customary industry practice in Malaysia. We have determined
that the costs of insuring for these risks and the difficulties associated with acquiring such insurance on commercially reasonable terms
make it impractical for us to have such insurance. If we suffer any losses, damages or liabilities in the course of our business operations,
we would not have insurance coverage to provide funds to cover any such losses, damages or product claim liabilities. Therefore, there
may be instances when we will sustain losses, damages and liabilities because of our lack of insurance coverage, which may in turn materially
and adversely affect our financial condition and results of operations.

Our planned expansions
outside Malaysia and in the ASEAN region subject us to risks inherent in international operations that can harm our business, results
of operations, and financial condition.

A key element of our