Page 346 - Full Book_24.4.2021

INDEPENDENT AUDITORS’ REPORT

TO THE MEMBERS OF BIMB HOLDINGS BERHAD

(INcORPORATED IN MALAySIA)
(cOMPANy NO. REGISTRATION NO: 199701008362 (423858-X))

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS (CONTINUED)
Key audit matters (continued)
Key audit matters How our audit addressed the key audit matters
Valuation of takaful contract liabilities Our audit procedures included the following:

Refer to Note 2.15 and 2.16 of the summary of significant Actuarial liabilities – family takaful contract liabilities
INTEGRATED ANNUAL REPORT 2020 We focused on this area due to the size of the carrying • Engaged our actuarial experts to assist us to assess if the valuation
accounting policies and Notes 22 and Note 50 of the
• Evaluated the design and tested the key controls over the family
Financial Statements.
takaful actuarial reserving process, including controls over the
reliability of data used in the calculation of actuarial liabilities.
value of takaful contract liabilities which represents
11.6% of the Group’s total liabilities.
methodologies used by the Group is in line with the valuation
In addition, valuation of takaful contract liabilities is a
valuation methodologies are consistent with recognised actuarial
highly subjective area as the Group exercised significant
practices derived from market experience.
judgement on the following areas: methods specified in the RBcT Framework. We also compared if the
Actuarial liabilities – family takaful contract liabilities • Assessed the reasonableness of the key actuarial assumptions,
340 particularly around mortality, morbidity, surrender rates, and discount
The actuarial liabilities have been estimated based on
the actuarial valuation methodologies as allowed under rates by:
the Risk-Based capital Framework for Takaful Operators (a) Reviewing the approach used by management to derive the
BIMB HOLDINGS BERHAD 199701008362 (423858-X) Family takaful contract liabilities to the unitholders and the • Evaluated the Group’s assessment of COVID-19 on the actuarial
assumptions using our industry knowledge and experience;
(“RBcT Framework”) issued by Bank Negara Malaysia
(“BNM”).
(b) comparing them with the Group’s actual historical experience,
market observable data (as applicable) and our views of current
participants’ accounts balances are substantially based on
trends and experience to-date.
the value of the account balance. Liabilities for unearned
revenue and takaful benefits which are dependent upon
liabilities including key judgements in relation to potential claims
operating assumptions and future investment return
arising from circumstances connected with the cOvID-19 pandemic.
assumptions that are reassessed at each reporting period.
As part of our audit, we focused on management’s
to assess if the methodologies and assumptions reviewed have been
valuation of the actuarial liabilities where it involves
consistently applied.
significant judgement about uncertain future outcomes, • Performed an independent review of model points on sample basis
including assumptions on mortality, morbidity, surrender • Assessed the analysis of movements in actuarial liabilities to determine
rates, and discount rates, as well as actuarial valuation whether the movements during the year are consistent with key
methodologies. actuarial assumptions adopted by the Group and our knowledge of
developments in the family takaful business.

• Assessed the appropriateness and adequacy of the Group’s disclosures
in relation to actuarial liabilities in the financial statements, including
sensitivity analysis of the key actuarial assumptions to different
scenarios.