in key assumptions. The effects of the movement in the key assumptions to the recoverable amount are as follows: Changes in assumptions % Impact on recoverable amount Increase RM’million Decrease RM’million Revenue growth rate 1.0 44.3 (36.5) Discount rate 1.0 (29.3) 32.2 NOTES TO THE FINANCIAL STATEMENTS 31 December 2023 TENAGA NASIONAL BERHAD Integrated Annual Report 2023 234 9 ASSOCIATES (CONTINUED) (b) (ii) Impairment assessment for Lumut Maritime Terminal Sdn. Bhd. (‘LMT’) 2023 The Group had reviewed the basis of impairment parameter updated based on 2023 data. Based on the assessment, the recoverable amount exceeded its carrying amount, hence no additional impairment loss was recognised in the current financial year. 2022 The Group had undertaken the impairment assessment of its investment in LMT, an associate. The assessment was triggeredby Net Zero 2050 initiative of no extension of Power Purchase Agreement (‘PPA’) provided for the coal fired power plant. Based on the impairment assessment, the carrying amount of the Group’s investment in LMT exceeded its recoverable amount by RM68.6 million. Key assumption used The recoverable amount was determined based on VIU calculations, which applied a discounted cash flow model of LMT for the remaining operation and maintenance contract period which expires in 2042 and its other sources of income. The cash flows used in the calculations are the most recent forecasts and projections approved by the Board of Directors and management of LMT. The key assumptions used in determining the VIU were: 2022 % Terminal growth rate 2.0 Cost of equity 9.0 The cash flows were discounted using cost of equity based on the risk specific to the industry. The key assumptions includes optimisation of LMT’s assets and no new source of business. The Group’s review includes impact assessment of changes in key assumptions. The effects of the movement in the key assumptions to the recoverable amount are as follows: Changes in assumptions % Impact on recoverable amount Increase RM’million