the Company make an overall assessment of whether the lease transfers substantially all of the risks and rewards incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; otherwise, then it is an operating lease. Operating leases Leases where the Group and the Company retain substantially all of the risks and rewards of ownership of the leased assets are classified as operating leases. The Group and the Company recognise lease payments received under operating leases as operating income on a straight- line basis over the lease term. Finance leases If the Group and the Company transfer substantially all of the risks and rewards incidental to ownership of the leased assets, leases are classified as finance leases. The Group and theCompany derecognise the leased assets and recognise the net investment in the lease as a receivable. The difference between the gross receivable and the present value of the receivable is recognised as unearned finance income. Lease income is recognised over the term of the lease using the net investment method, which reflects a constant periodic rate of return. The Group and the Company as lessees The accounting policy on ROU assets and lease liabilities for lessees are disclosed in Note 6. 15 LEASES (a) Finance lease receivables The Group’s finance lease receivables arise from Cooling Energy Supply Agreement (‘CESA’). Group Minimum lease payments Present value of minimum lease payments 2023 RM’million 2022 RM’million 2023 RM’million 2022 RM’million Within 1 year 2.0 2.0 1.1 1.2 After 1 year and not later than 2 years 2.0 2.0 1.5 1.3 After 2 years and not later than 3 years 2.0 2.0 1.6 1.5 After 3 years and not later than 4 years 2.0 2.0 1.7 1.6 After 4 years and not later than 5 years 1.3 2.0 1.3 1.7 After 5 years 0 1.6 0 1.3 7.3 9.6 6.1 7.4 9.3 11.6 7.2 8.6 Less: Unearned finance income (2.1) (3.0) Present value of minimum lease payment receivable 7.2 8.6 The effective interest rate implicit in the finance lease is approximately 9.5%