Annual Report 2019

FAR EAST CONSORTIUM INTERNATIONAL LIMITED 232 For the year ended 31 March 2019 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 32. OBLIGATIONS UNDER FINANCE LEASES Minimum lease payments Present value of minimum lease payments 2019 2018 2019 2018 HK$’000 HK$’000 HK$’000 HK$’000 Amounts payable under finance leases: Within one year 7,763 6,582 6,697 5,629 In more than one year but not more than five years 13,610 12,431 12,476 11,518 21,373 19,013 19,173 17,147 Less: Future finance charges (2,200) (1,866) – – Present value of lease obligations 19,173 17,147 19,173 17,147 Less: Amount due within one year shown under current liabilities (6,697) (5,629) Amount due after one year 12,476 11,518 It is the Group’s policy to lease certain of its motor vehicles and equipment under finance leases. The average lease terms range from 1 to 5 years. The average borrowing rates for the year is 6.71% (2018: 6.69%) per annum. Interest rates are fixed at the contract date. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments. The fair value of the Group’s finance lease obligations, determined based on the present value of the estimated future cash flow discounted using the prevailing market rate, at the end of the reporting period approximates to their carrying amount.