Report on the Audit of Financial Statements (Continued) Key Audit Matters (Continued) Key audit matter 2 Audit response Impairment of investment in associate – Pristine Islands Investment Pte. Ltd. and its subsidiary (“PIIPL Group”) (Refer to Notes 3.2 and 13 to the financial statements) As at 30 September 2025, the Group’s investment in its associate, PIIPL Group, comprises equity interests and non-trade amounts due from PIIPL Group. PIIPL Group mainly focuses on hospitality operations and related businesses. At year end, the Group assessed the non‑trade amounts due from PIIPL Group for expected credit losses using the general approach and recognised a 12‑month ECL loss allowance of $400,000 to reflect the credit risk exposure. During the financial year, management identified indicators of impairment in the associate and carried out an impairment assessment to determine whether an impairment loss was required. The recoverable amount was determined using a fair value less costs of disposal approach, for which management engaged an external valuation expert. This assessment involved significant judgement in valuing PIIPL Group’s business and estimating disposal costs. No impairment loss was recognised as the recoverable amount exceeded the carrying amount. We considered this area to be a key audit matter due to the significant management judgements and estimates involved in assessing the recoverable amount of the PIIPL Group. We performed the following audit procedures, amongst others: • Evaluated management’s assessment of whether the credit risk of the non-trade amount due from an associate had increased significantly; • Reviewed the adequacy of ECL allowance at year end, including assessing whether management’s approach was consistent with SFRS(I) 9 Financial Instruments (“SFRS(I) 9”) requirements; • Evaluated management’s assessment of impairment indicators relating to the investment the associate; • Assessed the reasonableness of key assumptions used in determining the fair value less costs of disposal, including range adjustments and marketability discount, with the assistance of our internal valuation specialist, and obtained management representation on the accuracy and completeness of financial data; and • Reviewed the adequacy and appropriateness of the related disclosures made in the financial statements. Other Information Management is responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and the independent auditors’ report thereon, which we obtained prior to the date of this report. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed on the other information that we obtained prior to the date of this report, we conclude that there is a material misstatement of this other information, we are required to report that fact. As described in the Basis for Qualified Opinion section, we are unable to conclude whether or not the other information is materially misstated for the same matter. Responsibilities of Management and Directors for the Financial Statements Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the provisions of the Act and SFRS(I)s, and for devising and maintaining a system of internal accounting controls sufficient to provide reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair financial statements and to maintain accountability of assets. ANNUAL REPORT 2025 KEONG HONG HOLDINGS LIMITED 55 INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF KEONG HONG HOLDINGS LIMITED
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