Annual Report 2019

189 Transport International Holdings Limited 2019 Annual Report Notes to the Financial Statements 13 Investment properties, investment property under development, interest in leasehold land and other property, plant and equipment (continued) (b) Right-of-use assets (continued) (i) Interest in leasehold land The Group holds several pieces of land for industrial and commercial buildings for its public transportation and property holding and development businesses. The Group is the registered owner of these property interests, including the whole or part of undivided share in the underlying land. Lump sum payments were made upfront to acquire these property interests from their previous registered owners or the Government, and there are no ongoing payments to be made under the terms of the land lease, other than payments based on rateable values set by the relevant government authorities. These payments vary from time to time and are payable to the relevant government authorities. (ii) Other properties leased for own use The Group has obtained the right to use other properties as its staff rest kiosks and bus regulators’ offices through tenancy agreements. The leases typically run for an initial period of two to three years. (c) Fair value measurement of properties (i) Fair value hierarchy The following table presents the fair value of the Group’s investment properties and investment property under development disclosed at the end of the reporting period on a recurring basis, categorised into the three-level fair value hierarchy as defined in HKFRS 13, Fair value measurement . The level into which a fair value measurement is classified is determined with reference to the observability and significance of the inputs used in the valuation technique as follows: – Level 1 valuations: Fair value measured using only Level 1 inputs i.e. unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date – Level 2 valuations: Fair value measured using Level 2 inputs i.e. observable inputs which fail to meet Level 1, and not using significant unobservable inputs. Unobservable inputs are inputs for which market data are not available – Level 3 valuations: Fair value measured using significant unobservable inputs